On Thursday finance ministry decided to put on hold additional installments of dearness allowance (DA) and dearness relief (DR) payable to central government employees and pensioners due from January 1 2020 till July 1 2021 in view of the ongoing corona virus pandemic.
Due to additional demands on the finances of the government comes current decision placed ,There is a need for major increase in expenditure on health as well as on welfare measures for various affected sections of society including the poor and vulnerable.
“In view of the crisis arising out of Covid-19, it has been decided that the additional investment of dearness allowance payable to central government employees & dearness relief to central government pensioners, due from January 1, 2020 s shall not be paid,” the finance ministry said in a statement.
This means that additional DA and DR installments due from January 1, 2020, July 1, 2020 and January 1, 2021 shall not be paid.However, the government will continue to pay DA and DR at current rates. The rate of DA and DR will be restored from July 1, 2021 with prospective effect.Further, no arrears will be paid for the period from January 2020 till June 30, 2021.
The combined savings of freezing of three installment of DA and DR to Central government employees and and pensioners would be Rs 37,530 crore in the financial year 2020-21 and 2021-22.State governments follow the Central government orders on DA/DR. It is estimated that the saving on freezing of three installments of DA and DR of state governments employees and pensioners, will be Rs.82566 crore.Thus total anticipated saving of Central government and state governments will be Rs 1.20 lakh crore, which help to fight against COVID-19.
