Central govt employees and pensioners may have the hopeful release of pay of 18 months of DA and DR arrears, which was frozen from January 2020 to June 2021 due to the COVID-19 crisis. The latest news suggests some progress toward a phased payout in 2025, bringing in some relief for over 1 crore beneficiaries. This article brings to the readers the latest updates, the estimated money involved, and how they may stay informed.
The Background of DA Arrears
The government stopped wage increases during April 2020 for the three cycles of January 2020, July 2020, and January 2021, to reduce fiscal burden during the pandemic, thereby saving ₹34,402 crore. Although DR hikes were resumed in July 2021, the 11% DA increase over a period of 18 months was not paid as arrears, leading to demands for payment by various unions including the National Council-JCM. With inflation at 5.2% in 2024, the employees need these dues to cope with rising prices.
Current Developments
Reports have it that a phased payout scheme is being drawn by the Department of Expenditure, with ongoing discussions between the Finance Ministry and employee unions. Further announcements may be made concurrent with the Union Budget 2025 or perhaps a special Cabinet meeting in mid-2025. The payout, if any, could be paid in 2-3 installments in 2025-26, with pensioners and lower pay levels getting precedence. The discussions though unconfirmed are certainly a hint of change, the cause being now good fiscal condition and union lobbying.
Estimated Arrears Amounts
Arrears are various under the pay level of the 7th Pay Commission:
- Level-1 Employees: Basic pay ₹18,000, arrears ₹11,000–₹37,000.
- Level-13 Officers: Basic pay ₹1,23,100, arrears up to ₹1.5 lakh.
- Pensioners: A proportional figure, e.g., ₹5,500–₹75,000 for a ₹9,000 pension.The figures indicate the arrears of withheld 11% DA/DR for a period of 18 months. Actual payout may cost nearly ₹40,000 crores, but on the plus side, it could very well see some money in the hands of common men and some retail spending.
Impact And Significance
Releasing arrears would provide more than just a financial relief. It recognizes the employees for their services during the pandemic, which would uplift their morale and raise the level of trust in public sector jobs. Increased consumer spending would boost economic growth in goods and services. Politically, it may build goodwill ahead of the 2026 elections. Though, the decision is challenged by the fiscal deficit situation and the forthcoming 8th Pay Commission, with its implementation starting in January 2026.
Process For Employees and Pensioners
Preparing for a payout:
- Update Details: Make sure password is entered correctly while updating Aadhaar, PAN, bank details, etc., on doe.gov.in or epfindia.gov.in to avoid undue delay in payments.
- Track Announcements: Keep a frequent watch on announcements on Budget 2025 related to arrears made by official sources such as the Finance Ministry or DoPT.
- Verify Payslips: Check for receipt of arrears in April 2025 salary slips for the recent 2% DA hike covering arrears from January to March.
- Keep in touch with unions: Stay abreast of NC-JCM or staff associations’ views on progress of implementation. Avoid sources outside these bodies to prevent misinformation, as happened with unverified claims in the past.
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