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DA from January 2013 – Cabinet Cleared hike in DA of 8%

DA from January 2013 – Cabinet Cleared hike in DA of 8% to Central Government Employees and Pensioners

As we expected Government has cleared the additional Dearness Allowance of 8% with effect from 1st January 2013 for Central Government employees, Central Pensioners and family Pensioners.  This decision was taken by Cabinet on the basis of All India Consumer Price Index (Industrial Workers) for the period from January 2012 to December 2012.

How to calculate DA from AICPI (IW)?

To calculate Dearness Allowance we require AICPI (IW) for previous 12 months.

Dearness Allowance with effect from 1st January every year (Average of AICPI-IW for the months from January to December of previous year – 115.76)X100/115.76
Dearness Allowance with effect from 1st July every year (Average of AICPI-IW for the months from July of previous year to June of this year – 115.76)X100/115.76
115.76 is a factor which converts 1982 series AICPI (IW) (Base 1982=100), which was applicable prior to 6CPC to 2001 series AICPIW (Base 2001=100). In turn, This is arrived at by dividing the 1982 series AICPI by a linking factor which is 4.63 (536/4.63=115.76)

All India consumer price index AICPI-IW for the period from January 2012 to December 2012

Month AICPI-IW
Jan 2012 198
Feb 2012 199
Mar 2012 201
Apr 2012 205
May 2012 206
Jun 2012 208
Jul 2012 212
Aug 2012 214
Sep 2012 215
Oct 2012 217
Nov 2012 218
Dec 2012 219

Average of AICPI (IW) for the period from January 2012 to December 2012:

(198+199+201+205+206+208+212+ 214+215+217+218+219)/12 = 209.33
DA with effect from 1st July 2012 = (209.33-115.76)X100/115.76)
= 80.83
Rounded to 80

You can also estimate DA using GConnect DA Calculator (Click here to go to GConnect DA Calculating Tool)

This increase in DA would benefit around 50  lakh employees and 30 lakh pensioners. It is also estimated that the the combined impact on the exchequer on account of both DA and DR would be of the order of Rs.8629.20 crore per annum and Rs. 10067.36 crore in the financial year 2013-14 (that is for a period of 14 months from January, 2013 to February, 2014).

Source : Press Information Bureau

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