WHY WE DEMAND 3% DA FROM 1ST JULY 2016 INSTEAD OF 2%
As the 7th Pay commission recommendations will be implemented with effect from 1.1.2016, the AICPIN average of 2015 will be the Base Index for calculation of DA for 7th Pay Commission
Formula for Calculation of DA in 7th Pay Commission is = (12 months Average of AICPIN -261.4) divided by 261.4 multiply by 100
[(263+264+266+269+270+269+269+267+268+271+275+277)/12]- (261.4) X100/261.4 = 2.91% and DA declared 2%. It is nothing but misappropriation.
Instead of 261.4 it should be 260.46 as the DA was given 125% instead of 125.75 in corresponding to price index of 261.4 from 1st January 2016. The rounding of the DA to lower digit will not compensate fully to the price rise and 100% neutralization DA. In other words corresponding to 125% DA, the price index shall be 260.46.
Thus the formula for calculation of DA for 7th CPC should be 12 months Average of AICPIN – 260.46 divided by 260.46 and multiplied by 100
Therefore the DA for July 2016 should be calculated as given below:
[(263+264+266+269+270+269+269+267+268+271+275+277)/12]-(260.46) X100/260.46 = 3.27 and the DA should be 3%.