<P> The Dearness Allowance was introduced following the second World War , and was then known as the `` Dear Food Allowance '' . The `` Old Textile Allowance '' was also introduced in 1947 , though this was revised and reintroduced in 1953 as the `` Revised Textile Allowance '' . Initially DA was given in response to demand of employees for wage revision , however later it was linked to Consumer Price Index . In the past various committees have been constituted to look into the issue of payment of D.A. to Central Government employees . The III Central Pay Commission recommended payment of DA whenever the CPI rose by 8 points over the index of 200 ( with base 1960 = 100 ) . The extent of neutralisation granted with effect from 1 - 1 - 1973 ranged from 100 % to 35 % . The IV Central Pay Commission recommended the grant of DA on a ' percentage system ' of the basic pay ( 1986 ). It also recommended payment of DA twice a year ; 1 January and 1 July. Each instalment of DA was to be calculated with reference to the percentage increase in the 12 monthly average of All India Consumer Price Index ( base 1960 ) . The extent of neutralisation now ranged from 100 % to 65 % . The V Central Pay Commission looked into the issue of differential neutralisation and found it to be injustice to senior officers and recommended uniform neutralization of 100 % to employees at all levels . The Commission had suggested that dearness allowance should be converted into dearness pay every time the cost of living rises by 50 % over the base level . The VI Central Pay Commission recommended revision of base year of the Consumer Price Index ( CPI ) as frequently as feasible.It also changed base year for DA calculation to 2001 ( base year 2001 = 100 ) </P>
<P> The Dearness Allowance was introduced following the second World War , and was then known as the `` Dear Food Allowance '' . The `` Old Textile Allowance '' was also introduced in 1947 , though this was revised and reintroduced in 1953 as the `` Revised Textile Allowance '' . Initially DA was given in response to demand of employees for wage revision , however later it was linked to Consumer Price Index . In the past various committees have been constituted to look into the issue of payment of D.A. to Central Government employees . The III Central Pay Commission recommended payment of DA whenever the CPI rose by 8 points over the index of 200 ( with base 1960 = 100 ) . The extent of neutralisation granted with effect from 1 - 1 - 1973 ranged from 100 % to 35 % . The IV Central Pay Commission recommended the grant of DA on a ' percentage system ' of the basic pay ( 1986 ). It also recommended payment of DA twice a year ; 1 January and 1 July. Each instalment of DA was to be calculated with reference to the percentage increase in the 12 monthly average of All India Consumer Price Index ( base 1960 ) . The extent of neutralisation now ranged from 100 % to 65 % . The V Central Pay Commission looked into the issue of differential neutralisation and found it to be injustice to senior officers and recommended uniform neutralization of 100 % to employees at all levels . The Commission had suggested that dearness allowance should be converted into dearness pay every time the cost of living rises by 50 % over the base level . The VI Central Pay Commission recommended revision of base year of the Consumer Price Index ( CPI ) as frequently as feasible.It also changed base year for DA calculation to 2001 ( base year 2001 = 100 ) </P>
basis of determining dearness allowance to employee in india is
basis of determining dearness allowance to employee in india is
Consumer Price Index
Consumer Price Index