New Cabinet at the wheel: Resume DA urgently

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More than 1.1 crore central government employees and pension holders have been waiting eagerly for July 1, when they expected their dearness allowance frozen since January 1, 2020 to be unfrozen. The day came and went by, and 10 days passed since then, but the government kept mum. But now with the new cabinet settling down, there can be no reason to prolong the uncertainty of the employees and pensioners.

Since January 1, 2020, the economy of this country passed through the worst phases in its history. Though government employees were immune from job losses, they did suffer serious erosion in salaries. By definition dearness allowance is designed to protect an individual, and his family, from rising inflation with which that part of the compensation is linked. By freezing the DA for the past 18 months, the government has allowed the real value of the salary of the employees and the pension of pensioners to go down. And the past 18 months witnessed some of the most severe price rise in the country.

Government employees and pensioners are, in a sense, a neglected lot. For the poor and under privileged, policymakers have spent days and months to design policy interventions to provide relief from the crippling pandemic, job losses, wage cuts and ruined businesses. On the opposite pole are the rich, who have enough resource-cushion not to feel the bruises from the steep economic fall. Incidentally, the Covid-hit times year recorded faster sales of Lamborghinis and Maybachs than in earlier years.

In a sense, the middle-class, of which government employees are a conspicuous part, have been most neglected. They continue to survive in a somewhat economic no man’s land.

The government has reported buoyancy in direct tax collections. Apart from a dip in June, indirect tax monthly collections, too, have been consistently recorded above Rs 1 lakh crore. The government should unfreeze the DA without any delay.