News Alert: The Ministry of Statistics and Programme Implementation (MoSPI) has officially announced the revision of the Consumer Price Index (CPI) Base Year from 2012 to 2024. This major structural change will directly impact how inflation is measured and, consequently, how the Dearness Allowance (DA) for Central Government Employees is calculated starting from January 2026.
The new series comes with significantly altered weightage for consumption items. The weight of Food and Beverages has been slashed, while Housing and Education have gained prominence. The first inflation data under this new series (for January 2026) is scheduled to be released on February 12, 2026.
• New Base Year: 2024 = 100.
• Linking Factor: To be announced (to convert 2012 index).
• Impact: Lower food weightage may reduce DA volatility.
• First Release: Feb 12, 2026.
Why the Base Year Was Changed?
The consumption pattern of Indian households has shifted drastically since 2012. The Household Consumption Expenditure Survey (HCES) 2023-24 revealed that Indians are spending less on food and more on housing, health, and transport. The old 2012 series failed to capture this reality, often overestimating inflation due to high food prices.
Impact on DA:
Since Dearness Allowance is linked to the AICPIN (All India Consumer Price Index), any change in the weighting diagram changes the final index value. With a lower weight for food (which is usually volatile), the new index is expected to be more stable but might show a slightly lower inflation rate during food price spikes.
Key Changes in Weightage (2012 vs 2024)
| Item Category | Old Weight (2012) | New Weight (2024) | Change |
|---|---|---|---|
| Food & Beverages | 45.86% | 36.75% | 📉 Reduced |
| Housing | 10.07% | 17.66% | 📈 Increased |
| Education | 4.46% (Sub-group) | 3.33% (Standalone) | 🔄 Reclassified |
| Health | 5.89% | 6.10% | 📈 Increased |
Source: MoSPI Official Data
What is the “Linking Factor”?
To maintain continuity with the old series (used for 7th Pay Commission calculations), the Labour Bureau will release a Linking Factor.
Formula: New Index (2024) × Linking Factor = Old Index (2012)
This derived figure will be used to calculate the DA % until the 8th Pay Commission establishes a new formula.
Will this reduce my DA?
Not necessarily. While the weight of food has dropped, the weight of Housing (rent) and Services has increased. If rent and tuition fees rise, the new index will capture it better than the old one.
When will the new DA rate be known?
The data for Jan 2026 (released on Feb 12) will be the first indicator. However, the confirmed DA rate for Jan 2026 is already projected based on the Dec 2025 index. This new series affects future hikes (July 2026 onwards).
हिंदी सारांश
सरकार ने महंगाई मापने का तरीका बदल दिया है। सीपीआई (CPI) का बेस ईयर अब 2012 की जगह 2024 होगा। नई सीरीज में खाने-पीने की चीजों (Food) का वेटेज 45% से घटाकर 36% कर दिया गया है, जबकि हाउसिंग (Housing) का वेटेज 10% से बढ़ाकर 17% किया गया है। इसका सीधा असर आपके महंगाई भत्ते (DA) की गणना पर पड़ेगा। नई सीरीज का पहला डेटा 12 फरवरी 2026 को जारी होगा।
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