The Central Government has put on hold till July 2021 the increase in dearness allowance (DA) for its about 49.26 lakh employees and 61.17 lakh pensioners because of the strain on finances due to the coronavirus lockdown.
The Centre also put on hold other allowances like LTC, etc, except for children education allowances till June 2020. The allowances include departmental canteen, office supplies expenses and the kind of wages as scheduled in the Cash Management System in Central Government. It also tweaked norms for advance payment in medical treatment and said only in emergency cases such grants may be processed.
In March, the Union Cabinet had approved an increase of 4 per cent in DA to 21 per cent.
“The Central Government employees and pensioners will now continue to receive DA at current rates, i.e., 17 per cent as part of their salary/pension,” according to the office memorandum.
The memorandum further stated that no arrears will be paid from January 1, 2020 to June 30, 2021. However, any hike in DA due to revision on July 1, 2021 will take into account the previous hikes as well.
The Government’s tax revenues have plummeted because of the Covid-19 lockdown while expenses have shot up because of the support provided to the vulnerable groups.
The Government revises dearness allowance twice a year to compensate for the rise in prices.
This is the first coronavirus impact on Central Government employees. The Government had earlier cut salaries of Ministers, Prime Minister, President and Members of Parliament by 30 per cent.
The Government earlier urged its employees to contribute one day’s salary of April 2020, which is payable in May. The pay deducted from the salary of employees will be contributed to the Prime Minister’s Citizen Assistance and Relief in Emergency Situations Fund (PM CARES Fund).
The Department of Revenue said in a circular that it has decided to appeal to the officers and staff of the Department to contribute their one day’s salary every month till March 2021 to the PM CARES Fund.
However, the circular also said, “Any officer or staff having objection to it may intimate Drawing & Disbursing Officer, Department of Revenue in writing mentioning his/her employee code latest by 20.04.2020.”
The employees of other departments, except those involved actively in the fight against Covid-19, may also have to contribute one day’s pay from their monthly salary to the fund. However, this may be voluntary, it noted.