It's official: DA to be restored from July.

Finance Ministry on Tuesday assured that three pending instalment of Dearness Allowances (DA) of central government employees and pensioners will be restored prospectively as and when the decision is taken.

The Finance Ministry added that the pending instalments of dearness allowance for the said employees will be " subsumed in the cumulative revised rates effective from 1 July 2021."

In a written reply in the Rajya Sabha today, Minister of State for Finance Anurag Thakur said the government has saved more than ₹37,430.08 crores from freezing three instalments of DA which helped in dealing with the Covid-19 pandemic that hit the country last year.

The three instalments of Dearness Allowance and Dearness Relief to central government employees and pensioners due from 1.1.2020, 1.7.2020 and 1.1.2021 was frozen in view of the coronavirus pandemic, FinMin said.

At present, central employees get DA of 17%. Last year, the Union Cabinet had approved a 4% increase in DA for government employees and pensioners to 21%. This was to be effective from January 1, 2021.

However, the finance ministry had in April 2020 decided to put on hold increment in dearness allowance (DA) for 50 lakh central government employees and 61 lakh pensioners till July 2021 due to the COVID-19 crisis.

"In view of the crisis arising out of Covid-19, it has been decided that the additional instalment of dearness allowance (DA) payable to central government employees and dearness relief (DR) to central government pensioners, due from 1st January, 2020 shall not be paid. Additional instalments of DA & DR from 1 July 2020 & 1 Jan 2021 shall also not be paid," the Ministry of Finance had said in a memo. However, DA and DR at current rates will continue to be paid.