DA: More than 10 million central government employees and pensioners have faced a significant setback prior to the increase in dearness allowance. The Modi administration has reiterated its position regarding the 18-month DA arrears that were suspended during the COVID-19 pandemic. In a recent parliamentary session, Minister of State for Finance Pankaj Chaudhary declined to authorize the payment of these 18-month DA arrears.

Pending DA arrears from July 2020 to January 2021

There had been earlier expectations that the upcoming General Budget for 2025-26, scheduled for presentation in February, might address the pending DA arrears from July 2020 to January 2021; however, this did not materialize. Prior to the budget announcement, employee unions had submitted a letter to the central government on this matter.

These organizations were optimistic that the government would take the arrears into consideration during the budget discussions, but this did not occur. The clarification provided by the Union Minister has left 4.8 million central employees and 6.7 million pensioners disheartened. During the parliamentary session, MP Anand Bhadoria raised a question in the Lok Sabha regarding the release of DA/DR dues, inquiring whether the dearness allowance and dearness relief for central government employees and pensioners, which had been halted for 18 months due to the pandemic, would be disbursed.

He sought details on the reasons for the government’s decision not to release these funds and whether the government would ensure that employees could utilize them.

The central government had saved Rs 34,402 crore

Minister of State for Finance Pankaj Chaudhary explicitly stated that the negative financial repercussions of the global pandemic in 2020, along with the funding of welfare initiatives undertaken by the government, had a fiscal impact following the financial year 2020-21. Consequently, the payment of the dearness allowance and dearness relief arrears is not feasible. The central government had saved Rs 34,402 crore by suspending DA/DR for 18 months during the pandemic.