Two days after the central government suspended disbursement of increased dearness allowance (DA) to its employees and pensioners announced last month and decided to freeze the next two hikes as well, former prime minister Manmohan Singh opposed the decision saying he did not think that at this "stage such cuts were necessary".
In a video message released by the Congress, Manmohan Singh, former Congress chief Rahul Gandhi, former Finance Minister P. Chidambaram and several other top leaders slammed the government over its decision.
Singh said, "We should be on the side of people whose DA is being cut. I sincerely believe that it is not necessary that it is the stage to enforce hardship to government servants and armed forces personnel."
The remarks of the Congress leaders came two days after the Central government decided to freeze payment of additional instalment of DA to all its employees and dearness relief (DR) to pensioners falling due from January 1, 2020.
The decision comes after the Union Cabinet on March 14 approved a four per cent hike in DA to 21 per cent in a bonanza for 1.13 crore Central government employees and pensioners applicable from January, 2020 costing the exchequer Rs 14,595 crore.
Rahul Gandhi also hit back at the government alleging that the government was not cutting back on extraneous expenditure. "I see the problem is that you are building your central vista at the same time. So either you are not sort of doing this extraneous expenditure. You are taking money from the middle class, not giving money to the poor people and spending it on central vista," Rahul Gandhi said.
Chidambaram in his message said, "We can make the point when we you have not cut back the expenditure on the bullet train and central vista development. Those are the problems which should be put on halt before you halt people's dearness allowance."
Congress MP Manish Tewari also opined that before the government went around cutting everyone's allowances and salaries, it should first set up an "expenditure rationalisation commission".
The decision will impact about 49.26 lakh central government employees and 61.17 lakh pensioners. A component of salary and pension for government employees, dearness allowance is meant to offset the cost of inflation. The government revises it twice a year.
As per the estimate of the finance ministry, the freeze will help the government save around Rs 37,530 crore.
The government’s tax revenues have plummeted because of the coronavirus lockdown while expenses have shot up because of the support provided to the vulnerable groups.
The next revision, the government said, will not be in July 2021 and the rates due from January 2020, July 2020, and January 2021 will be subsumed cumulatively in the revised rate.
This is the first coronavirus impact on central government employees. The government had earlier cut salaries of ministers, PM, president and members of parliament by 30%. In addition, there MPLADs scheme has also been suspended for two years to provide more funds to fight the coronavirus pandemic.
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