Calculation of Dearness Allowance
Post the Second World War, dearness allowance was introduced as a component by the government. After 2006, formula for calculating dearness allowance has been changed and currently, DA is calculated as mentioned below for the following set of employees-
For Central Government employees:
Dearness Allowance % = ((Average of AICPI (Base Year 2001=100) for the past 12 months -115.76)/115.76)*100
For Central public sector employees after 1/1/2007:
Dearness Allowance % = ((Average of AICPI (Base Year 2001=100) for the past 3 months -126.33)/126.33)*100
Where, AICPI stands for All-India Consumer Price Index.
From 1st of January 1996 onwards, dearness allowance is included in order to compensate for the price rise or inflation, in a specific financial year. Therefore, it is revised biannually, i.e. once on 1st January and then, on 1st July.
New DA Calculation Formula based on CPI (IW) after 7th Pay Commission implementation will be as follows.
| Dearness Allowance payable with effect from 7th CPC Basic Pay | = (Avg of CPI-IW for the past 12 months – Average of CPI-IW recorded in 2015)*100/(Average of CPI-IW recorded in 2015) |
DA from 1st January 2019: CENTRAL GOVT.
| Month | Actual AICPI-IW |
| Jan-2018 | 288 |
| Feb-2018 | 288 |
| Mar-2018 | 287 |
| Apr-2018 | 288 |
| May-2018 | 289 |
| Jun-2018 | 291 |
| Jul-2018 | 301 |
| Aug-2018 | 301 |
| Sep-2018 | To be released |
| Oct-2018 | To be released |
| Nov-2018 | To be released |
| Dec-2018 | To be released |
