Central government employees and pensioners will get full benefits of dearness allowance starting July 1, with all the three pending installments being restored prospectively, Minister for State for Finance, Anurag Thakur said in Parliament on Tuesday
Three installments of DA for central government employees and DR for pensioners, due on January 1, 2020, July 1, 2020 and January 1, 2021, were frozen in view of the COVID-19 pandemic.
The decision now to restore it from July, 2021 would benefit about 50 lakh central government employees and more than 65 lakh pensioners.
In a written reply to the Rajya Sabha, Thakur said: “As and when the decision to release the future installments of Dearness Allowance due from 01.07.2021 is taken, the rates of DA as effective from 01.01.2020, 01.07.2020 and 01.01. 2021 will be restored prospectively and will be subsumed in the cumulative revised rates effective from 01.07.2021.”
With the suspension of DA revision for one and half years, the government saved a total of Rs 37,530.08 crore that helped it to augment resources required to tide over the economic impact of the Covid-19 pandemic through various stimulus measures.
At present, central government employees get DA of 17 per cent. This level of DA became effective from July 2019 with further revision due from January 2020. But this along with subsequent two other revisions were suspended due to Covid.
Last year, the Union Cabinet had approved a 4 per cent increase in DA for government employees and pensioners to 21 per cent. This was to be effective from January 1, 2020. However, in wake of the pandemic the disbursement of DA at increased rates was suspended along with DR for the pensioners.
With the decision now to restore DA benefits from July 1, central government employees and pensioners could hope to get a fat increase in the allowance that will also cover for the possible increases in three previous due cycles.
However, any increase in DA from July 1 will only be effective from that day, meaning the employees would not get any arrears on non revision of DA for previous period.