Important and shocking news has come out for central employees and pensioners. Amid the ongoing discussion about the 8th Pay Commission, the government has clarified its position on the arrears of Dearness Allowance (DA). The Finance Ministry has clearly stated that the arrears of Dearness Allowance (DA) and Dearness Relief (DR) withheld for 18 months during the COVID-19 pandemic will not be released. This decision may dash the hopes that the employee organizations were putting. Let us know why the government took this tough step and what impact it will have on the employees.
Why were the DA/DR arrears stopped
When the issue was questioned in Parliament, Minister of State for Finance Pankaj Chaudhary responded to it. He said that the country’s financial situation was badly affected due to the pandemic in 2020. The financial burden of the public welfare schemes launched by the government during that time continued even after 2020-21. Due to this, it was not possible to pay 18 months’ DA/DR arrears from 1 January 2020 to 30 June 2021.
What was the question: Will the government reconsider the 18-month arrears of DA/DR, given the improvement in the economic condition of the country after the pandemic?
Government’s answer: It was decided to freeze three installments of DA/DR to reduce the pressure on the economic situation.
What are Dearness Allowance (DA) and Dearness Relief (DR)
Dearness Allowance (DA) is given to government employees so that they can combat the impact of inflation. Similarly, Dearness Relief (DR) is also given to pensioners for the same purpose. It helps in maintaining the purchasing power of employees and pensioners.
Can relief be obtained from the 8th Pay Commission
This clarification has come at a time when the discussion about the 8th Pay Commission has intensified. The Union Cabinet had given in-principle approval to its formation in January; however, the panel is yet to be constituted. Once the commission is formed, it will interact with all stakeholders and submit a detailed report within over a year.
The report will make recommendations for improving the fitment factor and all pay structures of central employees. An important point is that whenever a new pay commission is implemented, the dearness allowance (DA) is zeroed as per the standard procedure. Currently, under the 7th Pay Commission, the DA is 55% of the basic pay.