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New Delhi. For central government employees and pensioners, Dearness Allowance (DA) is not just an allowance, but a very important part of their income. But now the debate has intensified regarding the method of calculating this DA. Employee organizations believe that the existing formula does not properly reflect today’s rising inflation and changing lifestyle, hence a change in it has become necessary.

Why is the demand for change rising?

Employee organisations, especially the All India Trade Union Congress, have demanded the government to review the existing framework for calculating DA. He says that in today’s time the expenditure of the family has increased a lot as compared to earlier, but the basis of calculation still remains the same.

What is the problem with the current system

Currently DA is calculated on the basis of All India Consumer Price Index (AICPI-IW). This index decides the percentage of DA according to inflation, which is applied on the basic salary. However, workers say the system does not fully cover real expenses such as digital services, better health facilities, education and the cost of urban living.

Other main demands of employees

Employee organizations have suggested several major changes:

Demand to increase family size:In the current formula a family of 3 members is considered. There is a demand to increase it to 5 members, so that expenses like dependent parents can also be included.

modern expenses included Do: Internet, mobile, education and health services are now being considered as essential expenses, which should find a place in the formula.

Merging DA with basic salary: Employees argue that when DA goes above 50%, it should be added to the basic, so that future calculations can also be better.

Fitment Factor and Pension Reforms: Also included are demands for increasing the fitment factor and restoring the Old Pension Scheme (OPS) to make the pay hike more effective.