Central government employees and pensioners will get full benefits of dearness allowance starting July 1, with all the three pending installments being restored prospectively, Minister for State for Finance, Anurag Thakur said in Parliament on Tuesday. 

Three installments of DA for central government employees and DR for pensioners, due on January 1, 2020, July 1, 2020, and January 1, 2021, were frozen in view of the Covid-19 pandemic.

The Union Government has informed the Rajya Sabha in a written reply that as and when the decision to release the future installment of DA is taken, the rates of DA as effective from 01-01-2020, 01-07-2020, and 01-01-2021 will be restored prospectively.

The decision now to restore it from July 2021 would benefit about 50 lakh central government employees and more than 65 lakh pensioners.

With the suspension of DA revision for one and half years, the government saved a total of Rs 37,530.08 crore that helped it to augment resources required to tide over the economic impact of the Covid-19 pandemic through various stimulus measures.

At present, central government employees get DA of 17 percent This level of DA became effective from July 2019 with further revision due from January 2020. But this along with subsequent two other revisions were suspended due to Covid.Last year, the Union Cabinet had approved a 4 percent increase in DA for government employees and pensioners to 21 percent. This was to be effective from January 1, 2020. However, in wake of the pandemic, the disbursement of DA increased rates was suspended along with DR for the pensioners.

With the decision now to restore DA benefits, central government employees and pensioners could hope to get a fat increase in the allowance that will also cover the possible increases in three previous due cycles. However, any increase in DA from July 1 will only be effective from that day, meaning the employees would not get any arrears on non-revision of DA for the previous period.