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Freezing dearness allowance, dearness relief helped government save Rs 34,402 crore

Finance Minister Nirmala Sitharaman made the statement in a written response to a question to Rajya Sabha.

August 05, 2021 / 01:00 PM IST

"The decision to freeze DA and DR was taken in the context of covid-19 caused economic disruption so as to ease pressure on government finances," Sitharaman said.

The government saved Rs by freezing dearness allowance (DA) and dearness relief (DR) for central government employees and pensioners, Finance Minister Nirmala Sitharaman told Parliament.

Sitharaman made the statement in a written response to a question to Rajya Sabha.

"On account of freezing of three installments of DA and DR to central government employees and pensioners due from 01.01.2020, 01.07.2020 and 01.01.2021, a number of Rs 34,402.32 crores approximately has been saved," Sitharaman said.

Also read: Centre hikes central govt employees' dearness allowance to 28%

"The decision to freeze DA and DR was taken in the context of covid-19 caused economic disruption so as to ease pressure on government finances," she said.

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The Union Cabinet had recently approved a hike in the DA/DR rate from 17 percent to 28 percent with effect from July 1, 2021.

DA is paid by the government to its employees to compensate for the increase in the cost of living due to inflation. DR is the same as allowance and is given to central government pensioners.

In view of the COVID-19 pandemic, the government had frozen three installments of DA/DR payments, which were due on January 1, 2020, July 1, 2020, and January 1, 2021.
Moneycontrol News
first published: Aug 5, 2021 01:00 pm

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