DA - Dearness Allowance. .2011 Expectation goes higher. . . The most discussed among all

      DA is the most spoken word now a days by both  the State and Central Government Employees.. 

  In this post i am going to display you some of the basic concepts which constitute D.A. 

• What DA actually means ?
• What is the need for providing D.A. ?
• Whom does it benefit ?
• What is the previous methodology used to calculate DA ?
• What is the existing methodology  used to calculate DA ?
• What are the recommendations made in 6th central pay commission ?
• What does AICPI means ?  

Here are the answers for the above mentioned questions

• What D.A actually means ?
    Generally D.A. stands for Dearness Allowance.
  
  
• What is the need for providing D.A. ?
     The basic reason which lies behind the provision of D.A. is to compensate the  price rise against     various commodities .
  
  
• Whom does it benefit ? 
      It is eligible for all the government employees
  
  
• What is the previous methodology used to calculate DA ?
      The Fifth Central Pay Commission recommended uniform neutralization of DA at 100% to employees at all levels; conversion of DA into Dearness Pay each time the CPI increases by 50% over the base index with Dearness Pay counting for all purposes including retirement benefits; and Dearness Allowance including Dearness Pay being paid net of tax. The Commission did not favor the option of employing separate indices for each category of employee because of the sheer impracticality of the task and,therefore, recommended using the 12 monthly average of All India CPI (IW) with base 1982 for calculating DA
  
  
• What is the existing methodology  used to calculate DA ?
        Presently, the estimation of DA for Central Government Employees is based on the movements in the AICPI (IW)(1982=100).
  
  
• What does AICPI means ?  
        AICPI  - All India ConsumerPrice index
  
  
• What are the recommendations made in 6th central pay commission ?
    
• Recommendation 
• on chain base 
• index
       The feasibility of developing a Chain based index is dependent on the availability of time series data on both prices and the corresponding quantities demanded of each item. While there is merit in developing a chain based index for capturing inflation, this would be feasible only if the Consumer Expenditure Survey generates time series data, on both quantity consumed as well as value of expenditure for fairly large list of items in the consumption basket providing the possibility of substitution over short time span. The Government may explore this possibility. In the meantime, the Government should keep revising the base year in the existing fixed base index method as frequently as feasible

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• What is the expected  D.A. in January 2011 ?       
      Expected DA from Jan 2011 The central government employees received 10% DA in addition to 35% earlier,which now stands at 45%.They got the payment as two months arrears for July and August.The DA for September was calculated in their regular monthly payments.Through this hike employees got an increase of Rs700 to Rs900 in their monthly salaries. There was no such increase before this.Let us see some of the reasons.Read more . .
  
  
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