LETTER TO HON 'BLE MINISTER OF FINANCE

CGPA/KL/GL/2016    dated     01-08-2016

To

Shri. Arun Jaitely

Hon’ble Minister of Finance, North Block, New Delhi

Respected Sir,

          The purport and intent of this letter is to invite your kind attention to a perennial injustice being meted out to the employees and pensioners in computing DA / DR by ignoring the fraction element in 12 monthly average of cost of Index. A cursory look at this practice will convince you that employees and pensioners are denied a legitimate claim by way of neutralization of cost of living index fully. Considerable pecuniary loss is being sustained by them by following an irrational practice of computation of DA / DR ignoring the fraction element. This loss is significantly compounded whenever base year for calculation of DA / DR is changed consequent on revision of pay by merging DA with pay. This patent injustice is evidenced in the illustration given below:

Consumer Price Index

Month	Base Year 2001=100	12 monthly average	Increase over 115.76 (Old DA)	Increase over 261.42 (New DA)
June 2016	277	269.00	132.38	2.90

DA/DR Calculation with effect from 01-07-2016

	OLD (Rs.)	NEW (Rs.)	DA Computed without ignoring fraction	Loss in DA
Basic	10000	25700
DA	700	514	746	232

    A well laid principle of preventing erosion of real wages on account of rise in cost of living index is mutilated by pursuing the extant practice. It is respectfully submitted that in the computation of I.D.A., which is quarterly, the fraction element of average index is taken into account which may be adopted in C.D.A. case also. How this irrationality of ignoring the fraction element of average index has crept in the determination of C.D.A. is not easily understandable. Any way it can be affirmed without fear of contradiction that this extant practice deserves to be done away with. This Association earnestly requests you to kindly issue necessary orders putting an end to the unjust practice which cause loss in real wages / pension. Appealing for your benign indulgence in this matter.

Thanking you,                                                                                                         yours faithfully

                                                                                                     T.I. Sudhakaran, General Secretary

Copy to: 1. Shri. Shiv Gopal Mishra, Secretary, Staff Side, JCM, New Delhi

               2. Shri. K.K.N.Kutty, Secretary General, NCCPA, New Delhi