All about the Seventh Pay Commission

The pay of 47 lakh central government employees will now go up and 52 lakh pensioners will benefit

GN Bureau | June 29, 2016


#rise   #pension   #salary   #Seventh pay commission   #central government  
The cabinet has approved recommendations of the seventh pay commission
The cabinet has approved recommendations of the seventh pay commission

The union cabinet on Wednesday approved the implementation of the Seventh Pay Commission.

The centre had earlier in January set up a panel headed by cabinet secretary P. K. Sinha to process the recommendations of the Seventh Pay Commission headed by justice AK Mathur. The key recommendation is a 23.55 percent increase in salaries, allowances and pension of central government employees and pensioners. This is on the basis of the recommendation for a 14.27 percent hike in basic pay.
 
 Union finance minister Arun Jaitley had in his Budget for 2016-17 provisioned Rs. 70,000 crore towards the Seventh Pay Commission.
 Here is everything you need to know about the proposed recommendations in the Seventh Pay Commission.
 
Recommended Date of implementation:
The recommended date of implementation is January 1, 2016.  Hence, government employees will get arrears from January this year.
 
Minimum Pay: Based on the Aykroyd formula, the minimum pay in the government is recommended to be set at Rs 18,000 per month. The current minimum pay is Rs 7,000.
 
Maximum Pay: Rs 2,25,000 per month for Apex Scale and Rs 2,50,000 per month for Cabinet Secretary and others presently at the same pay level. Presently maximum pay is Rs 90,000.
 
The financial implications:
The total financial impact in the FY 2016-17 is likely to be Rs 102,100 crore, over the expenditure as per the ‘Business As Usual’ scenario.  This is about 0.7 percent of the GDP.
 
Of this, the increase in pay would be Rs 39,100 crore, increase in allowances would be Rs 29,300 crore and increase in pension would be Rs 33,700 crore.
 
Out of the total financial impact of Rs 102,100 crore, Rs 73,650 crore will be borne by the general budget and Rs 28,450 crore by the railway budget.
In percentage terms the overall increase in pay and allowances and pensions over the ‘Business As Usual’ scenario will be 23.55 percent. Within this, the increase in pay will be 16 percent, increase in allowances will be 63 percent, and increase in pension would be 24 percent.
 
The total impact of the commission’s recommendations are expected to entail an increase of 0.65 percentage points in the ratio of expenditure on (Pay+Allowances+Pension) to GDP compared to 0.77 percent in case of VI CPC.
 
New Pay Structure:
Considering the issues raised regarding the Grade Pay structure and with a view to bring in greater transparency, the present system of pay bands and grade pay has been dispensed with and a new pay matrix has been designed. Grade Pay has been subsumed in the pay matrix. The status of the employee, hitherto determined by grade pay, will now be determined by the level in the pay matrix.
 
 
 

Comments

 

Other News

A great literary feast (that could’ve been even more sumptuous)

A Case of Indian Marvels: Dazzling Stories from the Country’s Finest Writers Edited by David Davidar Aleph, 390 pages, Rs 999 Change is the only constant, and India has always been doing so. Yet, after independence, if there was a year when the p

Govt e-Marketplace sellers report more business

“My volume of business has increased ever since I registered on GeM (Government e-Marketplace) in 2017. Earlier, I could supply items only in the vicinity of my shop in Fort area and only within Mumbai. Now, I ship my products all over the country! I have tied up with India Post and three private cou

How the Hindi Newspaper Business Changed

The Journey of Hindi Language Journalism in India: From Raj to Swaraj and Beyond By Mrinal Pande Orient BlackSwan, 188 pages, Rs 1,195.00 In India, the English-language media is considered the ‘national media’, while the language press

More reforms in telecom sector in offing: Ashwini Vaishnaw

The telecom sector in the country will witness more reforms in the coming years, minister for communications, electronics & IT and railways Ashwini Vaishnaw has said. He also asserted that the industry too will have to do its bit and reciprocate by improving quality of service significantly.

Left-wing extremism: challenges and response

Left-wing extremism is in existence right from India’s independence, but it became prominent in 1967 under the name of Naxalism. The nomenclature of this movement has changed from time to time and place to place depending upon the leadership. Before 2014 more than 15 states were facing this problem w

Agri Min organises events ahead of International Year of Millets 2023

A series of pre-launch events and initiatives have been organised by the Department of Agriculture and Farmers Welfare on the MyGov platform in the run-up to the International Year of Millets 2023 to create awareness and a sense of participation in the country  around the ancient and forgotten golden

Visionary Talk: Amitabh Gupta, Pune Police Commissioner with Kailashnath Adhikari, MD, Governance Now


Archives

Current Issue

Opinion

Facebook    Twitter    Google Plus    Linkedin    Subscribe Newsletter

Twitter