Centre rejects demand for release of frozen DA/DR arrears, cites Covid-19 fiscal impact

The Ministry of Finance has reiterated that the release of frozen Dearness Allowance (DA) and Dearness Relief (DR) arrears for Central Government employees and pensioners is not feasible.

In an official communication issued by the Department of Expenditure (F. No. 20/1/2026-E.II(B)) dated April 15, 2026, the Ministry responded to a representation dated 10.02.2026 regarding the issue of DA/DR arrears.

The Ministry stated that the decision to freeze these instalments was taken in the context of the COVID-19 pandemic, which caused significant economic disruption and required measures to ease pressure on government finances.

It further stated that the financial impact of the pandemic extended beyond FY 2020–21 due to continued welfare expenditure, and therefore the release of arrears was not considered feasible.

“The adverse financial impact of pandemic in 2020 and the financing of welfare measures taken by the Government had a fiscal spill over beyond FY 2020-21, arrears of DA/DR were not considered feasible.”

The communication was digitally signed by Manoj Kumar Jain, Under Secretary, Department of Expenditure.

Centre approves 2% DA hike for government employees

The decision will increase monthly salary and pension payouts, depending on the applicable basic pay of employees and pensioners.

Dearness Allowance is periodically revised by the government to offset the impact of inflation and rising cost of living, ensuring that real income levels of employees and pensioners are adjusted in line with price movements.

The latest revision comes as part of the regular DA adjustment cycle, which is based on inflation data and the government's assessment of cost-of-living trends.