7th Pay Commission DA from July 2016 will be 2% – Dearness Allowance Calculation based on CPI from July 2016 to June 2016
After 7th Pay Commission recommendations was accepted and notification to this effect was issued by Govt on 25th July 2016, All India Consumer Price Index (Industrial Workers) for the month of June 2016 has been released on 29th June 2016.
Now, consumer price index (industrial workers) for all 12 months from July 2015 to June 2016 which are required for calculation of DA from June 2016 for Central Goverrnment Employees and Pensioners have been released now.
Now that, 7th Pay Commission recommendations will take effect from 1st Jan 2016. Though 7th Pay Commission has recommended for using the same series of Consumer Price Index (Industrial Workers) with Base 2001=100, DA Calculation formula used for 6th CPC Pay will have to be revised as DA to the extent of 125% will be merged with Basic Pay on implementation of 7th Pay Commission recommendations.
As per gazette notification issued by Govt on 25th July 2016 for implementation of 7th Pay Commission recommendations, DA related proposals have been accepted as such.
Extract of notification dated 25.07.2016 relating to 7th Pay Commission:
|Sl. No.||Recommendation of the Seventh Central
|Decision of the Government|
|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.
As per the decision of Govt given above it could been seen that DA on 7th CPC Pay with effect from 1st January 2016 will be reset to 0%.
New DA Calculation Formula based on CPI (IW) after 7th Pay Commission implementation will be as follows.
|Dearness Allowance payable with effect from 7th CPC Basic Pay||= (Avg of CPI-IW for the past 12 months – Average of CPI-IW recorded in 2015)*100/(Average of CPI-IW recorded in 2015)|
DA from 1st January 2016
We have all the actual Consumer Price Indices from January 2015 to December 2015 based on which DA from Jauary 2016 is calculated to be 0%
|DA with effect from 1st January 2016||= [261.4]-(261.4)X100/261.4|
DA from 1st July 2016
|DA with effect from 1st July 2016||= [ (263+264+266+269+270+269+269+267+268+271+275+280)/12]-(261.4)X100/261.4|
|= 2 %|
Use the DA Calculator for 7th Pay Commission Pay given below and calculate DA from July 2016 at ease.
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