The State government, which is facing a funds crunch, will save around ₹7,300 crore this financial year by freezing the increase in the dearness allowance and suspending the encashment of earned leave.
The decision on DA, which will affect around 12 lakh government employees and 7.4 lakh pensioners and family pensioners, will save the exchequer ₹4,900 crore, while the one on leave encashment will save around ₹2,450 crore.
While the announcements mark “substantial savings” for the government, they do not take away any benefit that employees and pensioners currently enjoy, according to an official of the Finance Department. It may be pointed out that the Kerala government has decided to deduct the salary of its employees for six days every month for the next five months.
As far as employees of the Tamil Nadu government are concerned, the decisions mean a 12% cut in their average annual emoluments. Currently, employees and pensioners are being paid 17% DA, which would have otherwise gone up to 25% during the course of the year. Invariably, the employees exercise the option of encashing their earned leave for 15 days in a year or 30 days in a block of two years.
These measures are “administratively more simple” than resorting to a cut in salary for a specific period, as being done in Kerala, or deferring the payment of salary. Besides, in respect of the DA hike freeze, the State government has emulated the Centre, the official pointed out.
The government has taken these decisions at a time when its repeated requests for more funds from the Centre remain unfulfilled.
The State government has, among other things, sought a special grant of ₹1 lakh crore for all States, including ₹9,000 crore for Tamil Nadu; ₹3,000 crore for the augmentation and strengthening of health infrastructure; ₹1,321 crore towards custom milled rice subsidy for paddy procurement; and an ad-hoc grant of ₹1,000 crore from the National Disaster Response Fund to procure medical and protective material.
