DA MAY GO UP BY 2%4%

The Centre is likely to announce a hike of 2-4% in dearness allowance for about 50 lakh employees and 58 lakh pensioners later this month. Dearness allowance and dearness relief are provided to neutralise the impact of inflation. Labour unions, however, are not happy with the proposed hike.

NEWDELHI:The Centre is likely to announce a hike of 2-4% in dearness allowance for about 50 lakh employees and 58 lakh pensioners later this month.

Dearness allowance and dearness relief are provided to neutralise the impact of inflation. Labour unions, however, are not happy with the proposed hike.

Confederation of Central Government Employees’ president KKN Kutty expressed dissatisfaction over such a “meagre” hike saying that the consumer price index for industrial workers (CPI-IW) which is an agreed benchmark, is far from reality.

He said there is a difference between quantum of price rise ascertained by labour bureau and agriculture ministry.

The average CPI-IW to be taken into account is 4.95% from January 1 to December 31, 2017. Since the government has already hiked the dearness allowance by 2% in October last year from July 1, 2016, it will now raise it further by 2%.

As per an agreed-upon formula, the Centre hikes the allowance taking 12-month average of retail inflation. The government does not consider the price rise rate beyond a decimal point for deciding the rate. Therefore, despite the fact that the hike works out to be 2.95%, the government will ignore the rate of price rise beyond decimal point and increase the DA by 2%.

Kutty said that the federation, in the next meeting of the national council, would make a case for considering the fractions while fixing DA.

The national council is an apex forum functioning under the Department of Personnel and Training where issues concerning central employees are discussed.