The Confederation of Central Government Employees and Workers has urged the government to revise the formula for Dearness Allowance (DA) and Dearness Relief (DR) calculation for central employees and pensioners. Currently, DA and DR are calculated based on the average of the last 12 months, but the Confederation proposes a change to the average of the last 3 months.

Key Points:

1. Current Formula Disparity: The Confederation highlighted the inequality in the current DA calculation method. Employees working in public sector units (PSUs), including government banks, get their DA adjusted every three months, while central government employees in other departments have to wait for 12 months.

2. Proposed Change: The Confederation suggests that the formula should be updated to calculate DA every three months instead of annually, similar to how it is done for employees in PSUs and banks. This would help central employees and pensioners receive DA more in line with actual inflation changes and would address the 0.9% DA gap they currently face.

3. DA Calculation Methodology:

   • For Public Sector Employees (PSUs):
     DA = { (Average of AICPI (Base Year 2001=100) for last 3 months – 126.33) / 126.33 } x 100
   • For Central Government Employees:
     DA = { (Average of AICPI (Base Year 2016=100) for last 12 months – 115.76) / 115.76 } x 100

4. Impact:
   If the formula is revised, central employees and pensioners would get DA adjustments every three months, reflecting the actual price rise and improving their financial conditions. The Confederation is pushing for a uniform DA calculation method across all government sectors.

The Confederation’s request aims to bring fairness and equity in the DA calculation system, ensuring that employees across all government sectors benefit from timely adjustments to their allowances.