How much increase in DA for central govt employees, pensioners from January 2022. Calculated
- 7th pay commission: A linking factor of 2.88 is required to bridge the old series of CPI and the new consumer price index for calculating the DA.
The Dearness Allowance (DA) to be paid to the central government employees and pensioners starting January 2022 will be 34%. The DA will be calculated on the basis of the All India Consumer Price Index for the months of 2021.
The DA for central government employees was earlier calculated based on the consumer price index with the base year 2001. The government replaced it with a new consumer price index with the base year 2016 to calculate the DA from September 2020. A linking factor of 2.88 is required to bridge the old series of CPI and the new consumer price index for calculating the DA.
This linking factor will be used to determine Dearness Allowance of Central Government Employees and Pensioners. Consumer Price Index with base 2016=100 for the month of January 2021, which is 118.2, can be converted to CPI with base 2001=100 by multiplying it to the linking factor.
Here's the table for January-December 2021 to calculate CPI (IW) 2001=100 using the linking factor:
|2021||CPI (IW) 2016=100 released by Govt from Sep 2020||CPI (IW) 2001=100 calculated using the linking factor of 2.88|
To calculate to new DA applicable to central government employees and pensioners
DA with effect from 1st January 2022 =[(340+343+344+346+347+350+354+354+355+360+362+361)/12]-(261.4)X100/261.4]
The DA for central government employees and pensioners will be 34, a 3% increase as compared to the current DA rate of 31%.