No memorandum issued on resumption of DA, DR to govt employees, says Finance Ministry

The Union Finance Ministry issued a clarification that it has not issued any office memorandum regarding the resumption of Dearness Allowance (DA) for central government employees and Dearness Relief (DR) for pensioners from July 2021. The Ministry in a tweet said the document doing the rounds on social media claiming resumption of DA to Central Government employees & Dearness Relief to Central Government pensioners is fake. "No such OM has been issued by GOI," it tweeted.

In April 2020, the government had passed on a memorandum to put a hold on the hike in DA for the year. The decision was taken owing to the crisis of COVID-19. 

“In view of the crisis arising out of COVID-19, it has been decided that additional installment of dearness allowance payable to Central government employees and dearness relief (DR) to central government pensioners due from January 1, 2020, shall not be paid." The additional installment of DA and DR due from July 1, 2020, and January 1, 2021, shall also not be paid," the Department of Expenditure had said. However, DA and DR at current rates will continue to be paid, it had said. 

The clarification comes on a day when the Central government was scheduled to hold a meeting to decide on the pending arrears.

Dearness Allowance benefits for Central Govt workers

Last month, the Ministry of Labour & Employment had informed that Dearness Allowance benefits more than 1.50 crore Central government employees. The ministry had also marginally increased the Dearness Allowance for Central Government employees, the minimum wage of industrial workers employed in the central sphere including mining and construction activities from Rs 105 to Rs 210 per month by revising the Variable Dearness Allowance in May 2021. 

Why is Dearness Allowance important?

Over 50 lakh employees and 65 lakh (over one crore) pensioners are eligible to benefit from the latest increase in Dearness Allowance by the Centre. On the whole, an increase in Dearness Allowance for central government employees definitely grants more money in the hands of both present and former employees (pensioners). A rise in Dearness Allowance directly improves one's take-home salary if one is a central government employee.