BIG: Centre freezes DA & DR at current rates till July 1,2021 amid COVID-19 crisis

In a big development on Thursday, the Centre announced the freezing of the Dearness Allowance (DA) for the Central government employees and the Dearness Relief (DR) for the Central government pensioners at current rates. The Union Cabinet's decision in March to hike the DA and DR rates from 17% to 21% shall not come into force until July 1, 2021. This call has been taken in the wake of the ongoing novel coronavirus crisis.

It added that the installments of DA and DR due from January 1, 2020, July 1, 2020, and January 1, 2021, shall not be paid. At the same time, the DA and DR at the current rate of 17% will continue to be paid. Moreover, it has been clarified that no arrears from January 1, 2020, to June 30, 2021, shall be paid even when the Centre decides to release the future installment of DA and DR. In such a scenario, the Ministry of Finance has promised to restore the DA and DR rates applicable from January 1, 2020, prospectively and will be subsumed in the cumulative revised rate effective from July 1, 2021. Nearly 1.13 crore families are expected to be affected by this move. 

Read: President Promulgates Ordinance Reducing Salaries Of MPs By 30% Amid COVID-19 Crisis

Read: Cabinet Clears 4% Dearness Allowance Hike, 48 Lakh Central Govt Employees To Benefit

Cost-cutting measures by the Centre

The Centre has already implemented a number of cost-cutting measures. On April 6, the Union Cabinet approved an ordinance to amend 'The Salaries, Allowances and Pension of Members of Parliament Act, 1954'. Basically, the salaries payable to Lok Sabha and Rajya Sabha MPs have been reduced by 30% till April 1, 2020. President Ram Nath Kovind, Vice President M Venkaiah Naidu and all the Governors have also voluntarily decided to take a 30% salary cut. The MPLADS funds were suspended for two years. Information and Broadcasting Minister Prakash Javadekar stated that Rs.7,900 crore saved from the MPLADS will go to the Consolidated Fund of India. 

Read: 'India Stands Together' Says Amit Shah As He Welcomes The 30% Salary Cut For MPs

Read: Coronavirus Live Updates: India's COVID Tally Soars 21393 With 4258 Recovered, 681 Deaths