7th Pay Commission Latest News Today: How to calculate Dearness Allowance (DA) - Here is easy math

7th pay commission: The government recently had increased Dearness Allowance (DA) of central employees by 5 per cent. This was nothing less than a Diwali gift given to the central employees making new DA to 17 per cent instead of 12 per cent. With this decision of the government, about Rs, 6,000 crore will come in the accounts of as many as 1.1 crore government employees.

This decision of the government on Dearness Allowance (DA) has brought a smile on the face of government employees. But what is this dearness allowance and how is it calculated. 

Dearness allowance is given to improve the living standards of the government employees. This allowance is given to government employees, pensioners, and public sector employees. It is given so that even after rising inflation, employees do not have any problem in living. Also, Usually the Dearness Allowance is changed every 6 months, i.e in January and July.

Dearness allowance is given on the basis of Salary structure of employees. Dearness allowance is different for government employees working in urban, semi-urban and rural areas. The Dearness Allowance in the Sixth Pay Commission was increased from 139 per cent to 142 per cent on January 1, 2018.

It is calculated on the basic salary of an employee. A formula has been fixed for calculating Dearness Allowance, which is determined by the consumer price index or CPI.

This formula is-

Percentage of Dearness Allowance = CPI average of the last 12 months - 115.76. Now whatever comes, it will be divided by 115.76. The number that comes will be multiplied by 100.