Considering the living cost and all, Wage Revision is being done once in five years or ten years. But inflation will go up day by day and subsequently the money value will come down. To compensate for this, we have to wait until the next Wage Revision, which is not practical. That is why the DA is introduced.
The devaluation of money can be assessed through Wholesale Price Index, All India Consumer Price Index, etc. The difference between these two is that the price variation of all commodities is taken into account for Wholesale Price Index.
But for AICPI, there are some differences/limitations:
1. There is a particular Consumer, viz. Industrial Worker.
2. Some specified goods & services are defined, called "basket of goods."
3. Along with the price variation of commodities, its consumable quantity will also be considered.
4. All over India, 78 Centres are selected to take an average.
Based on All India Consumer Price, Industrial DA is being paid; variable in quarters commencing from January, April, July & October. For January, the AICPI will be the average of the previous September, October & November. Similarly, for April, it will be December, January & February, for July it will be March, April & May, and for October, it will be June, July & August respectively.
When the money devaluation is fully compensated, it is called full DA neutralisation. The formula for full DA neutralisation = (Total points - Base points) / Base points (in percentage). The AICPI was introduced in India in 1960 and revised in 1982 & 2001. AICPI of 2001 x 4.63, we get AICPI of 1982 and AICPI of 1982 x 4.93, we get AICPI of 1960. For DA calculation, AICPI of 1960 is accepted as the base.
Now in India, mainly two terms wage settlements are in existence; Wage Settlements of 1.1.1997 & 1.1.2007. The base point in 1.1.1997 is 1708 & in 1.1.2007 is 2884.
I shall quote one example, i.e. calculation of AICPI for July '10. This is equivalent to the average of the previous March, April & May; which is recorded as 170, 170 & 172 (Base year 2001). Multiply by 4.63 and round, we get 787, 787 & 796 (Base year 1982). Multiply by 4.93 and round, we get 3880, 3880 & 3924 (Base year 1960). Find the average of these 3 and round, we get 3895.
DA for 1.1.97 scale. Total points - 3895, Base points - 1708, Total - Base = 2187. The percentage is 2187/1708 x 100 = 128.0 (Correct to one decimal).
DA for 1.1.2007 scale. Total points - 3895, Base points - 2884, Total - Base = 1011. The percentage is 1011/2884 x 100 = 35.1 (Correct to one decimal).
I shall insert an Excel sheet for IDA calculation w.e.f 1.10.2008. You may extend the rows further (as necessary) and just enter the 3 indexes towards the year 2001 in green-colored columns. The results will appear in yellow, and red is used for static information.
With regards,
ABBAS.P.S,
Secretary,
ITI Employees' Association,
ITI Limited, PALAKKAD - 678 623,
KERALA, INDIA.
+91 9447 467 667
AICPI (base 2001) can be obtained from the following site.
[Labour Statistics Page 2](http://labourbureau.nic.in/indexes.htm)
From India, Bangalore
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530The devaluation of money can be assessed through Wholesale Price Index, All India Consumer Price Index, etc. The difference between these two is that the price variation of all commodities is taken into account for Wholesale Price Index.
But for AICPI, there are some differences/limitations:
1. There is a particular Consumer, viz. Industrial Worker.
2. Some specified goods & services are defined, called "basket of goods."
3. Along with the price variation of commodities, its consumable quantity will also be considered.
4. All over India, 78 Centres are selected to take an average.
Based on All India Consumer Price, Industrial DA is being paid; variable in quarters commencing from January, April, July & October. For January, the AICPI will be the average of the previous September, October & November. Similarly, for April, it will be December, January & February, for July it will be March, April & May, and for October, it will be June, July & August respectively.
When the money devaluation is fully compensated, it is called full DA neutralisation. The formula for full DA neutralisation = (Total points - Base points) / Base points (in percentage). The AICPI was introduced in India in 1960 and revised in 1982 & 2001. AICPI of 2001 x 4.63, we get AICPI of 1982 and AICPI of 1982 x 4.93, we get AICPI of 1960. For DA calculation, AICPI of 1960 is accepted as the base.
Now in India, mainly two terms wage settlements are in existence; Wage Settlements of 1.1.1997 & 1.1.2007. The base point in 1.1.1997 is 1708 & in 1.1.2007 is 2884.
I shall quote one example, i.e. calculation of AICPI for July '10. This is equivalent to the average of the previous March, April & May; which is recorded as 170, 170 & 172 (Base year 2001). Multiply by 4.63 and round, we get 787, 787 & 796 (Base year 1982). Multiply by 4.93 and round, we get 3880, 3880 & 3924 (Base year 1960). Find the average of these 3 and round, we get 3895.
DA for 1.1.97 scale. Total points - 3895, Base points - 1708, Total - Base = 2187. The percentage is 2187/1708 x 100 = 128.0 (Correct to one decimal).
DA for 1.1.2007 scale. Total points - 3895, Base points - 2884, Total - Base = 1011. The percentage is 1011/2884 x 100 = 35.1 (Correct to one decimal).
I shall insert an Excel sheet for IDA calculation w.e.f 1.10.2008. You may extend the rows further (as necessary) and just enter the 3 indexes towards the year 2001 in green-colored columns. The results will appear in yellow, and red is used for static information.
With regards,
ABBAS.P.S,
Secretary,
ITI Employees' Association,
ITI Limited, PALAKKAD - 678 623,
KERALA, INDIA.
+91 9447 467 667
AICPI (base 2001) can be obtained from the following site.
[Labour Statistics Page 2](http://labourbureau.nic.in/indexes.htm)
From India, Bangalore
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