Govt. workers want DA to be merged with salary.

   Government employees have asked the Centre to consider merging dearness allowance with their pay, arguing that the Sixth Pay Commission -- quite like the Centre -- could not have anticipated the high inflation that has eroded real wages over the last decade.

   Since 2006 – when the recommendations of the last pay commission came into force – the dearness allowance has increased to 90%, a reflection of the high inflation environment that employees have to cope up with.

   The demand was made at a preliminary meeting held between the department of personnel and the employee representatives to discuss the proposed Seventh Pay Commission announced by Prime Minister Manmohan Singh in September.

Merger of Dearness Allowance with the Pay of the Central Government Employees – reg.

Prime Minister’s Office
New Delhi – 110101

Sub: LETTER OF Sh. M RAGHAVAIAH
NFIR, 3, CHELMSFORD ROAD, NEW DELHI-55

   A letter dated 27-09-2013 received in this office from Sh. M RAGHAVAIAH is forwarded herewith for action as appropriate.

[RITU SHARMA]
SECTION OFFICER

NFIR
National Federation of Indian Railwaymen
3, CHELMSFORD ROAD, NEW DELHI- 110055
Affiliated to:
Indian National Trade Union Congress (INTUC)
International Transport Workers’ Federation (ITF)

No. 1/5 (A)

Dated: 27.09.2013

Hon’ble Prime Minister of India,
Raisina Hill,
South Block,
New Delhi.

Respected Sir,

Sub:- Merger of Dearness Allowance with the Pay of the Central Government Employees – reg.

   While thanking you for the decision for appointment of 7th Central Pay Commission, we request you to kindly appreciate that the Dearness Allowance paid to the Central Government employees had crossed 50% of pay as on 01.01.2011. This portion of the Dearness Allowance needs to be merged with the Pay for all purposes as was done in the year 2004.

Dearness Allowance (DA) linked to Consumer Price Index against inflation..

   The Consumer Price Index is the main base for calculation of Dearness Allowance for the Central Government and State Government Employees and also the Industrial and Bank Employees.

   The Consumer Price Index (CPI) is calculated using following steps:

   a) Market prices are collected for 252 items by the Officials of Department of Statics and Department of Posts. These prices of that item & place are sent to Central processing unit from 78 centres all over India ( which are enclosed for your reference).

   b) The all India weights given the each category of items such as food 49.71%, housing 9.77 %, fuel 9.49% , footwear O.68%, transportation 7.5%, Medical 5.31%, Personnel care 2.92 % & Miscellaneous 26.31% total 100% . CPI points are determined using this all India weights and prices of the 252 items. (which are enclosed for your reference).

Merger of 50% DA issue: Dearness Allowance as Dearness Pay

GOVERNMENT OF INDIA
MINISTRY OF  FINANCE
RAJYA SABHA

UNSTARRED QUESTION NO-4384

ANSWERED ON-07.05.2013

Dearness Allowance as Dearness Pay

4384 . SARDAR BALWINDER SINGH BHUNDAR

   (a) whether the earlier Pay Commissions for Central Government Employees had recommended that a certain percentage of Dearness Allowance to be treated as Dearness Pay;

   (b) if so, the details thereof; and

   (c) by when the salaried class as well as pensioners are likely to be benefited so as to overcome the hardship being faced by them to maintain their day-to-day household expenses?

ANSWER

   Minister of State in the Ministry of Finance (E & FS) (Shri Namo Narain Meena)

   (a)&(b) The 5th Pay Commission had recommended that Dearness Allowance should be converted into Dearness Pay each time the Consumer Price Index increases by 50% over the base index used by the last pay Commission. Accordingly the Government issued orders on 27.02.2004 for merging of 50% of the DA with the basic pay w.e.f.01.04.2004.

   (c) The 6th Central Pay Commission had recommended not to merge Dearness Allowance with basic pay at any stage. Government has accepted this recommendation vide Resolution dated 29.08.2008. Hence the question to merge DA with basic pay does not arise. However, the rate of DA is being revised at periodic intervals.

Source: www.rajyasabha.nic.in