DA & Linking Factor What's expected? DA Announcement and linking factor explored

DA & Linking Factor  What's expected?  DA Announcement and linking factor explored.

As you all know that DA is calculated based on AICPIN.

AICPIN is calculated based on the inflation and the cost of living in various cities. So, what's going to happen in 7th Pay Commission, let's read.

In Pay Commission III, the base year was used as (1960 =100).
In 4th Pay Commission, the DA was decided to pay twice a year and also for calculating the DA value the percentage increase in the 12 monthly average of All India Consumer Price Index (base 1960). Also the base year was (1982=100) as the base year.

In 5th Pay Commission, the DA was decided based on (1982=100) as the base year.
In 6th Pay Commission, the DA was decided based on (2001=100) as the base year.
In 7th Pay Commission, should we expect to have the base year as (2011=100)?

When the DA calculation change happened from base year 1982 to base year as 2001, there were a steep increase in the DA percentage, this is because the cost of living has increased multifold and also various cities and items was also included while calculating the real DA.

So, what's been recommend in the 7th CPC Report
Keeping in mind that the present formulation of DA has worked well over the years, and there are no demands for its alteration, the Commission recommends continuance of the existing formula and methodology for calculating the Dearness Allowance and also check out the gazette notification changes where the linking factor has been included as on AICPIN value as 2016.

IV. Dearness Allowance

Sl.No.	Recommendation of the Seventh Central Pay Commission	Decision of the Chief Justice of India
1.	Existing formula and methodology for calculating Dearness Allowance to continue (Para 8.17.37 of the Report)	Accepted. The reference base for calculation of Dearness Allowance after coming into force of the revised Pay Structure shall undergo change accordingly and will be linked to the average index as on 01.01.2016

Though in (2001=100) the linking factor was 4.63, this lead to the calculation of DA with the average index as 115.76 as per 2005. For example, (2005 , 12 Month Average Index  536, so the linking factor as per record was 4.63).

All India and Centre-wise Linking factors between New Series of Consumer Price Index Numbers for Industrial Workers on base 2001 = 100 and the previous series on base 1982=100 (General Index).

Table No. 9.01

GROUP WISE LINKING FACTORS BETWEEN CURRENT SERIES OF ALL INDIA CONSUMER PRICE INDEX NUMBERS

FOR INDUSTRIAL WORKERS ON BASE: 2001 = 100 AND THE PREVIOUS SERIES ON BASE: 1982 = 100

	Group	Linking Factor
I-A	Food Group	4.58
I-B	Pan. Supari, Tobacco & Intoxicants	6.16
II	Fuel & Light	4.77
III	Housing	6.18
IV	Clothing. Bedding & Footwear	3.22
V	Miscellaneous	4.55
	GENERAL INDEX	4.63

Note: Figures on previous base 1982 = 100 can be obtained by multiplying the Index Number on current base 2001 = 100 by the linking factor and rounding off the result to the nearest whole number.
As you all now understand that the linking factor play a major role in getting the DA value, but the linking factor for year 2016 .

I was not able to find this data in Labour Bureau . We assume that if the linking factor of 2016 used, then we expect to get a higher DA percentage (assumption). This means it would be a real DA value as it would include various cities and the current inflation and CPI.

We hope that when the results are out they would be using the linking factor of 2016 as the gazette notification has this mentioned. Normally the DA announcement is release in September 1st week or 2nd week and hope this is announced shortly.

Source :  7thpaycommissionnews.com

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Expected DA from July, 2016: AICPIN for the Month of May, 2016 released

Expected DA from July, 2016: AICPIN for the Month of May, 2016 released

No. 5/1/2016- CPI 

GOVERNMENT OF INDIA
MINISTRY OF LABOUR & EMPLOYMENT
LABOUR BUREAU

`CLEREMONT', SHIMLA-171004

DATED: 30th June, 2016

Press Release

Consumer Price Index for Industrial Workers (CPI-IW) — May, 2016

The All-India CPI-IW for May, 2016 increased by 4 points and pegged at 275 (two hundred and seventy five). On 1-month percentage change, it increased by (+) 1.48 per cent between April, 2016 and May, 2016 when compared with the increase of (+) 0.78 per cent between the same two months a year ago.


The maximum upward pressure to the change in current index came from Food group contributing (+) 3.69 percentage points to the total change. At item level, Rice, Wheat, Arhar Dal, Gram Dal, Masur Dal, Urd Dal, Groundnut Oil, Eggs (I len), Fish Fresh, Milk, Chillies Green, Brinjal, Cabbage, French Bean, Potato, Tomato, Sugar, Petrol, etc. are responsible for the increase in index.


The year-on-year inflation measured by monthly CPI-IW stood at 6.59 per cent for May, 2016 as compared to 5.86 per cent for the previous month and 5.74 per cent during the corresponding month of the previous year. Similarly, the Food inflation stood at 8.48 per cent against 7.55 per cent of the previous month and 5.99 per cent during the corresponding month of the previous year.


At centre level, Salem reported the maximum increase of 12 points followed by Puducherry and Mysore (11 points each), Bengluru (10 points), Quilon, Warrangal and Coonoor (9 points each). Among others, 8 points increase was observed in 3 centres, 7 points in 5 centres, 6 points in 5 centres, 5 points in 9 centres, 4 points in 6 centres, 3 points in 9 centres, 2 points in 6 centres and I point in 17 centres. On the contrary, Amritsar recorded a decrease of 1 point. Rest of the 10 centres' indices remained stationary.


The indices of 31 centres are above All-India Index and other 42 centres' indices are below national average. The indices of Pune, Salem, Vishakhapatnam, Bokaro and Varanasi centres remained at par with All-India Index.


The next issue of CPI-IW for the month of June, 2016 will be released on Friday, 29th July, 2016. The same will also be available on the office website www.labourbureaunew.gov.in.

Sd/-
(SHYAM SINGH NEGI)
DEPUTY DIRECTOR GENERAL

Source:- AICPIN May, 2016

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AICPIN March 2016 – Expected DA July 2016 – 3rd Stage Completed

AICPIN March 2016 – Expected DA July 2016 – 3rd Stage Completed

Press Release of AICPIN for the month of march 2016

No. 5/1/2016- CPI
GOVERNMENT OF INDIA
MINISTRY OF LABOUR & EMPLOYMENT
LABOUR BUREAU

`CLEREMONT’, SHIMLA-171004
DATED: 29th April, 2016

Press Release

Consumer Price Index for Industrial Workers (CPI-IW) – March, 2016

The All-India CPI-IW for March, 2016 increased by 1 point and pegged at 268 (two hundred and sixty eight). On 1-month percentage change, it increased by (+) 0.37 per cent between February, 2016 and March, 2016 when compared with the increase of (+) 0.40 per cent between the same two months a year ago.

The maximum upward pressure to the change in current index came From Food group contributing, (+) 0.37 percentage points to the total change. At item level. Wheat and Wheat Atta, Fish Fresh, Goat Meat, Poultry (Chicken), Milk, Chillies Dry. Chillies Green, Potato, Seasonal Green Vegetables and Fruit items, Tea (Readymade). Sugar, Private Tuition Fee, etc. are responsible for the increase in index. However, this increase was checked by Rice, Arhar Dal. Mustard Oil, Eggs (Hen), Garlic. Onion. Tomato, Supari. Petrol, Flower/Flower Garlands, etc.. putting downward pressure on the index.

The year-on-year inflation measured by monthly CPI-IW stood at 5.51 per cent for March, 2016 as compared to 5.53 per cent for the previous month and 6.28 per cent during the corresponding month of the previous year. Similarly, the Food inflation stood at 6.16 per cent against 6.18 per cent of the previous month and 6.98 per cent during the corresponding month of the previous year.

At centre level, Munger-Jamalpur reported the maximum increase of 10 points followed by Raniganj (9 points) and Ludhiana (7 points). Among others, 5 points increase was observed in 4 centres, 3 points in another 9 centres, 2 points in 9 centres and I point in 14 centres. On the contrary, Mundakkayam recorded a maximum decrease of 6 points followed by Ernakulam and Puducherry (5 points each). Tiruchirapally and Warrangal (4 points each). Among others, 3 points decrease was observed in 2 centres, 2 points in 9 centres and 1 point in another 9 centres. Rest of the 14 centres’ indices remained stationary.

The indices of 33 centres are above All-India Index and other 43 centres indices are below national average. The indices of Bokaro and Varanasi centres remained at par with All-India Index.

The next issue of CPI-IW for the month of April, 2016 will be released on Tuesday, 31st May, 2016.

The same will also be available on the office website www.labourbureaunew.gov. in.

Authority: www.labourbureaunew.gov. in

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7th CPC DA : A decade-long journey begins!

7th CPC DA : A decade-long journey begins!

“The Dearness Allowance calculations as per the recommendations of the 6th Central Pay Commission come to an end; the method prescribed by the 7th Central Pay Commission comes into effect from Jan 2016 onward…!”

The 7th Central Pay Commission was appointed in order to evaluate the methods of calculating the salaries, incentives, benefits, pensions, retirement benefits, and Dearness Allowance of the Central Government employees and serving and retired personnel of the Indian defence forces, and suggest changes, if and when required. Four months have passed since the Central Pay Commission submitted its final report to the Centre.

The government at the centre has the discretion to accept, reject, or modify the recommendations made by the Central Pay Commission. It has constituted a high-level committee to look into the various suggestions in the report. The final decision on the implementation of the recommendations will be made based on the feedback from this empowered committee.

Meanwhile, the Central Government employees federations met with the high-level empowered committee to discuss various issues, including Minimum Wages and Fitment Factor, and to suggest required amendments in the report.

There is likely to be a delay in the publication of the notification containing the accepted recommendations by the 7th Pay Commission. Since the election Model Code of Conduct will be in place until the last week of May 2016, the Government acceptance notification is expected to be published in the first week of June. In that case, there are chances that the revised salaries will be issued from the month of June. Also, the arrears for the past five months are also likely to be released then.

Dearness Allowance is one of the much-anticipated topics among Central Government employees. In its report, the 7th Central Pay Commission had given a short explanation about Dearness Allowance.

The 6th Central Pay Commission suggested elaborate changes in the method of calculating Dearness Allowance. This time however, the 7th Central Pay Commission did not suggest any elaborate changes. It has suggested that the same process be continued.

We have presented an easy-to-use calculator here for you to calculate the likely Dearness Allowance hike. (Click to Calculate Expected DA)

We have presented a ready reckoner of the procedures that were followed when the 5th Central Pay Commission drew to a close and the 6th Central Pay Commission came into effect, which are very likely to be followed this time too.

The AICPIN points of only the month of January are available as of now. The AICPIN points for February will be released tomorrow.

You can come up with approximate AICPIN points for the remaining four months to calculate the approximate Dearness Allowance.

As of January 1, 2016, according to the Centre, the Dearness Allowance stood at 125 percent. An order of the Ministry of Finance to this effect will be released soon. In the event that the 7th Central Pay Commission recommendations come into effect from January 1, 2016 onwards, the salaries of the Central Government employees will be revised by adding 125 percent to their basic pay. The new Dearness Allowance hike will be issued from 01.07.2016 onwards.

For example, if the basic pay of an employee, as on 01.01.2016, is Rs.12,000 (Grade Pay 2800 + 9200), his salary revisions and Dearness Allowance hikes as per the 6th and 7th Central Pay Commission recommendations, are given below.

Employee’s Pay as on 1.1.2016 as per the recommendations of 6th CPC
Basic Pay + 125% DA: 12000 + 15000 = 27000
Employee’s Pay as on 1.1.2016 as per the recommendations of 7th CPC
Basic Pay + No DA: 31000 + 0 = 31000

(No Dearness Allowance for the period between Jan to Jun 2016 and the first instalment of additional DA will be given only on 1.7.2016)

Source: 7thpaycommissionnews.in\

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EXPECTED DA FROM JULY 2016 BEGINS..! AICPIN FOR JANUARY 2016

EXPECTED DA FROM JULY 2016 BEGINS..! AICPIN FOR JANUARY 2016

All India Consumer Price Index for Industrial Workers on Base 2001=100

The Labour Bureau, under the Ministry of Labour and Employment has now released the AICPIN points for the month of January 2016, the index stands at 269.

The first index point for the year 2016 has been released by the Central Government and the 7th Pay Commission DA Calculation also starts with this first index.

The next issue of CPI-IW for the month of February, 2016 will be released on Thursday, 31st March, 2016

No.5/1/2016- CPI
GOVERNMENT OF INDIA
MINISTRY OF LABOUR & EMPLOYMENT
LABOUR BUREAU

CLEREMONT, SHIMLA-171004
DATED: 29th February, 2016

Press Release

Consumer Price Index for Industrial Workers (CPI-IW) – January, 2016

The All-India CPI-IW for January, 2016 remained stationary at 269 (two hundred and sixty nine). On 1-month percentage change, it remained static between December, 2015 and January, 2016 when compared with the rise of 0.40 per cent between the same two months a year ago.

The largest upward pressure to the change in current index came from Housing group contributing (+) 1.11 percentage points to the total change. At item level, Wheat, Wheat Atta, Groundnut Oil, Fish Fresh, Eggs (Hen), Goat Meat, Poultry (Chicken), Milk (Buffalo & Cow), Garlic, Sugar, Bidi, Firewood, Medicine (Allopathic), Barber Charges, Flower/Flower Garlands, Tailoring Charges, etc. are responsible for the increase in index. However, this increase was checked by Rice, Arhar Dal, Gram Dal, Masur Dal, Moong Dal, Urd Dal, Mustard Oil, Coconut Oil, Onion, Vegetable and Fruit items, Petrol, etc., putting downward pressure on the index.

The year-on-year inflation measured by monthly CPI-IW stood at 5.91 per cent for January, 2016 as compared to 6.32 per cent for the previous month and 7.17 per cent during the corresponding month of the previous year. Similarly, the Food inflation stood at 7.61 per cent against 7.94 per cent of the previous month and 7.81 per cent during the corresponding month of the previous year.

At centre level, Haldia reported the maximum increase of 8 points followed by Jamshedpur (7 points) and Labac-Silchar (5 points). Among others, 4 points increase was observed in 6 centres, 3 points in another 6 centres, 2 points in 9 centres and 1 point in 14 centres. On the contrary, Bhilai recorded a maximum decrease of 9 points followed by Bokaro (6 points) and Ranchi-Hatia and Varanasi (4 points each). Among others, 3 points decrease was observed in 2 centres, 2 points in 11 centres and 1 point in 10 centres. Rest of the 13 centres’ indices remained stationary.

The indices of 34 centres are above All-India Index and other 40 centres’ indices are below national average. The indices of Salem, Varanasi, Jabalpur and Vishakhapathnam centres remained at par with All-India Index.

The next issue of CPI-IW for the month of February, 2016 will be released on Thursday, 31st March, 2016. The same will also be available on the office website WWW. labourbureaunew.gov.in.

(SHYAM SINGH NEGI)
DEPUTY DIRECTOR GENERAL

Source: www.labourbureau.nic.in

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