NEW DELHI : The Union government on Thursday freezed dearness allowance (DA) and dearness relief (DR) for 11 million employees and pensioners from January 2020 to July 2021, which can potentially help the government save over ₹37,000 crore in the short run.
The order issued by the department of expenditure means the 4% DA and DR hike approved by the government in March effective 1 Jan 2020 (from existing 17% to 21%), will not be paid now.
Besides, the DA and DR hikes scheduled for July 2020 and 1 Jan 2021 will not be announced till July 2021. The DA hike, when announced next year, will not paid in retrospective.
The financial implication can be gauged from the that when the Union government had announced the 4% DA/DR hike for 5 million central government employees and 6.5 million pensioners in March, it had estimated that it will cost the central exchequer over ₹14,500 crore.
Similarly, the DA hike announced in October 2019 effective July last year was pegged will cost the government around ₹8,000 crore.
The views expressed in this article are the writer's, they do not reflect the views of Opera News.
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