The
Union Cabinet approval for the 6% rise in the Dearness Allowance for
the Central Government employees is expected to be announced on coming
Thursday. It is a well-known fact that every six months, the Central
Government increases the Dearness allowance for its employees during the
months of January and July. The increased amount is
calculated on the price index (CPI IW BY 2001=100) of essential
commodities. Rise in the Dearness allowance is being calculated on the
basis of the changes in the prices of the essential commodities during
the periods between January and June and the period between July and
December.
But, it takes around three
months since the release of the price index for the months of June and
December to arrive at the calculation for the increase in the Dearness
allowance. With the result that the increase due from the month of July
is being given only from the month of October and the amount due from
January is being given only from the month of April.
And, because of this
situation, the amount due for the left-behind period of two months is to
be settled as arrears. Practical problems arise in the calculation of
the arrears amount and also problem arises in clarifying the doubts of
the beneficiaries. Pensioners especially, are more tensed up over this
procedure.
To avoid this situation, the
price index during the periods from November to April and from May to
October can be taken into account and the increase in the Dearness
allowance calculated based on the information relevant to these periods.
The amount can be disbursed from the months of January and July as per
this calculation so that there’s no due as arrears.
We imaginatively tested this
method to find out the result. It was found out that there was no
tangible change in the increase amount if calculated on the basis of the
price index obtained during the months of April and October.
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