New Delhi, July 26 : The Centre has saved around Rs 34,402.32 crore by freezing three instalments of dearness allowance (DA) and dearness relief (DR) amid the Covid-19 pandemic.
In a written reply to the Lok Sabha, the Minister of State for Finance, Pankaj Chaudhary, said that the decision to freeze DA and DR was taken in the context of the economic disruptions caused by Covid-19 so as to ease the pressure on government finances.
The minister said that the government has increased the existing rate of DA from 17 per cent to 28 per cent, payable to Central government employees from July 1, 2021. This increase subsumes the additional instalment arising on January 1, 2020, July 1, 2020 and July 1, 2020.
The minister informed the House that the rate of DA from January 1, 2020 till June 30, 2021 will remain at 17 per cent.
"On account of freezing of three installments of DA and DR for Central government employees and pensioners due from 01.01.2020, 01.07.2020 & 01.01.2021, an amount of Rs 34,402.32 crore approximately has been saved," Chaudhary said.
The government had drawn a lot of flak from the opposition for freezing DA and DR during the pandemic.
In April, Congress spokesperson Abhishek Manu Singhvi had said that the government had kicked the people's stomachs by cutting Rs 37,500 crore, which was admittedly payable as DA by the 7th Pay Commission to 115 lakh army staff and pensioners from the armed forces, and serving employees and pensioners of the Central government.
The Department of Expenditure under the Finance Ministry had recently said in a circular that the increase in DA subsumes the additional instalments arising out of all the three frozen instalments.