After Uttar Pradesh, Uddhav Thackeray led Maharashtra govt is likely to hold its employees Dearness Allowance (DA), Leave Travel Concession (LTC) for two years amid coronavirus crisis. According to TOI reports, the government has decided to cut its employees existing budgetary provision to raise more than Rs 70,000 crore. The bureaucrat said that after the nationwide lockdown was announced on March 24, all economic activities came to a halt. This development comes days after announced that has decided to freeze dearness allowance hike of its employees and pensioners till July 2021.
According to report, Maharashtra govt is also likely to cut development expenditure and district funds of its staffers.
“As currently there is zero resource mobilisation, we have no option but to drastically cut the existing budgetary provision to raise more than Rs 70,000 crore. We have absolutely no scope to cut the provision for wages, pension and interest on loans taken by the state. We will have to cut development expenditure and freeze the DA and LTC of around 12 lakh employees,’’ a senior bureaucrat told TOI.
“The central government has stopped the DA for the past eight years and we will freeze it too. If we freeze the DA till June 2021, we will be able to mobilise Rs 18,000 crore. If we do not pay LTC, it will help us mobilise another Rs 1,000 crore,” he added.
The bureaucrat told TOI shrinkage of development expenditure will lead to larger savings.
“In the budget for the current year, we have made a provision of Rs 1.1 lakh crore for development workers. A high-level committee headed by chief secretary Ajoy Mehta will take a decision on the quantum of cut. Taking into account the current financial situation, we expect at least 50% cut in development expenditure. In that event, we will be able to mobilise nearly Rs 56,000 crore,’’ he said.
The Union Finance Ministry has decided to not roll out any increment in the dearness allowance (DA) for its 1.13 crore government employees and pensioners' at current levels.
“In view of the crisis arising out of COVID-19, it has been decided that the additional installment of Dearness Allowance payable to Central Government Employees, Dearness Relief to Central Government pensioners, due January 1, 2020 shall not be paid,” said an Office Memorandum of Department of Expenditure, Ministry of Finance.To be noted the April salary, which is due to be paid in a week’s time, was supposed to be based on revised DA, along with arrears for three months (January-March).
In March this year, the government had approved a hike in the dearness allowance rate from 17 per cent to 21 per cent of the basic pay/pension effective from January 1, 2020 under 7th pay commission recommendation.