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Tamil Nadu favours freezing DA

Tamil Nadu is in favour of freezing dearness allowance as part of efforts to tide over the difficult financial position of the states and forging a national consensus on how to contain employees' costs.

"The distress has to be shared. Employees cannot expect increase in emoluments as a routine, when states are floundering to meet their obligations to the poor", Tamil Nadu Chief Minister J Jayalalithaa said addressing the meeting of the chief ministers on the fiscal situation of the states in New Delhi on Friday.

Stating that the states needed a facility, which would provide funds on soft terms to undertake the right sizing process, she said the automatic mode, "which governs the employees' compensation packages, defeats us. Chief ministers find their hands completely tied". This was particularly true in the case of dearness allowance, she said.

Hitting out at the fiscal gurus and seasoned economists suggesting drastic cuts in food subsidy and subsidised electricity as quick-fix solutions for fiscal woes, the Jayalalithaa said the greatest emphasis has to be placed on correcting the imbalance arising out of the burgeoning employee costs.

The increase in the number of employees and extraordinary employee remuneration packages in the wake of the recommendations of the Fifth Central Pay Commission had contributed to the fiscal collapse of the states, she said adding her government has put in place a ban on filling up vacancies in all except essential departments.

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