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Labour Ministry dismisses reports of new CPI-IW series leading to pay hike of employees

NEW DELHI: The labour ministry on Friday dismissed media reports that the launch of new series of Consumer Price Index for Industrial Workers (CPI-IW) would lead to a hike in salaries of government employees and industrial workers. The CPI-IW is used primarily for measuring Dearness Allowance (DA) payable to workers in the organized sector including PSUs, Banks and Insurance companies besides government employees.

“Labour Ministry denies reports in a section of media appearing under the caption “Govt. employees set to get more DA” published on October 16, 2020,” the ministry said in a statement.

The ministry has never said that the new index would lead to a hike in salaries of industrial workers and government employees, it clarified.

Labour Bureau, an attached office of the ministry, is going to release new series of CPI-IW with 2016 as base year on October 21. At present, the base year for the index is 2001.

The ministry said this index is used for revision of dearness allowance payable to government employees and workers in the organized sector.

However, it explained that the hike in salaries of industrial workers and government employees will depend on the behaviour of new series, which is too early to predict at this stage.

The new series of CPI-IW would be more comprehensive as it would have over 300 items in its basket like health, education, food compared to 200 in the existing index.

Besides, it would collect data from around 90 different centres or markets across the country in the new series compared to 77 in the existing index.

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