On the edge of being paid was one long-overdue payment of the 18-month DA arrears that largely help relieve central government employees. The central government, after nearly two decades of wrangling and employees’ unions asking repeatedly about such payments, has finally set the date for this pay. The arrears are for Dearness Allowance that was withheld from employees from January 2020 to June 2021 in the middle of the COVID 19 pandemic.
The Backdrop
With the pandemic setting foot nationally, the government did stop all increases in Dearness Allowance as a cost-saving measure, thus impacting more than 50 lakhs employees and 65 lakhs pensioners. Although the DA increases were started from July 2021 onwards, the arrears for the freeze period have not been paid, leading to memorandum after memorandum and representations from various government employees associations.
The arrears were hard to withhold for a period considered in three installments of:
- January 1, 2020
- July 1, 2020
- January 1, 2021
These DAs would have been higher every time during that freeze period, that is, from 17% to 28% had the freeze not been imposed. The settling now is being done on the difference of amounts with one-time payment only.
The Payment Date As Final Setter
It was all reported that; the Government now has given its sanction for payment, and therefore the DA arrears shall be credited by July 2025. The Department of Expenditure, under the Ministry of Finance, shall shortly issue an official notification in this regard.
The amount of arrears for pensioners and employees will be dependent on their basic pay and grade. Arrears can average anywhere between ₹11,000 to ₹2,00,000, depending on the pay.
Employee Reaction And Demand By Unions
The employee unions welcomed this decision but remained adamant that interest on delayed payments should be paid, as well as the setting of a time limit for future DA settlements. Several unions had threatened protests and legal action if the payment of arrears was not completed by 2025.
Why This Matters
The one-time additional payment will go a long way in helping Government employees and retirees just before the festive season whilst there is talk of heavy inflation. It also shows that the Government wants to settle long-running financial issues before they get worsened by growing pressure from the staff unions.
Conclusion
This announcement of the 18-month DA arrears payments, nearly 50% of salary, a massive blow, brings relief to millions of government employees and pensioners. This long-pending payout scheduled for July 2025 is eventually due to witness a flow to the beneficiaries that would cement their morale and economic stability.
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