The pending 18-month Dearness Allowance (DA) arrears to central government employees and pensioners have long been a major issue of discussion and expectation. New developments have given both clarity and renewed hope for the delivery of these dues.
Background-Cutting off DA Arrears
During the COVID-19 crisis, the Indian government froze three installments of the DA and Dearness Relief (DR) that were due to be paid to employees as of January 1, July 1, and of January 2021. Such actions were taken with a view to reducing the pressure on government coffers in an environment of economic disruption as a consequence of a pandemic. Approximately 48 lakh central government employees and 65 lakhs pensioners were affected by that decision.
Government Position on DA Dues
In the Rajya Sabha during August 2024, Minister of State in the Ministry of Finance, Pankaj Chaudhary, spoke on this point. He announced the government does not have any plans regarding the release of the withheld DA/DR Dearness Allowance and Relief.
The minister mentioned that the matter has been taken as freezing these installments in light of the economic impact of COVID-19 under such conditions for relieving pressure on government finances. He added that the malignant financial impacts of the pandemic were beyond the fiscal year 2020-21 and hence keeping this release of dues unfeasible at that time.
Renewed Hope Follows Approval of the 8th Pay Commission
In January 2025, the Union Cabinet granted approval for the 8th Pay Commission, which is responsible for the revision of salaries and pensions in the Central Government for employees and pensioners. This has once again raised hopes regarding the disbursement of the 18 months’ DA dues. Employee federations like the National Council of Joint Consultative Machinery (NC JCM) renewed their appeals before the government to release dues withheld. They justified that under the current more favorable economic conditions, this was a suitable time to compensate the employees and pensioners for the dues held back during the pandemic.
The Financials
Freezing these DA and DR installments led to huge government savings. Media reports have stated about a saving of ₹34,402.32 crore by the government with this decision. These savings were then used to fund various welfare programs in the economy to mitigate the damage from the pandemic.
As of March 2025, there has not been any official announcement regarding the release of the 18-month DA. Though the approval of the 8th Pay Commission has offered a platform for discussion of various benefits of employees, including that of DA arrears, no change in the government’s position has occurred. Employee organizations push hard for the release of these dues on the ground of improved economic conditions, as well as on the financial hardships borne by employees and pensioners during the dues period.
Conclusion
The pending DA dues for 18 months is still an issue of contention between central government servants and the government. These developments have reignited discussions and rekindled hopes, but the final outcome will depend on discussions still going on, as well as the government’s assessment of its financial position. Employees and pensioners should keep themselves updated through official information channels regarding further developments related to this issue.
