1. 7th Pay Commission report recommends 23.55% jump in govt servants’ salary; wants starting pay at Rs 18,000

7th Pay Commission report recommends 23.55% jump in govt servants’ salary; wants starting pay at Rs 18,000

7th Pay Commission: Minimum basic pay for central govt staff recommended at Rs 18,000; maximum pay Rs 2.25 lakh per month

By: | New Delhi | Updated: November 20, 2015 11:41 AM
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The Centre’s total salary and pension bill, including that of railway employees who account for more than a third of its salary expenditure, will go up from Rs 4.33 lakh crore estimated otherwise to Rs 5.35 lakh crore in FY17. Analysts expressed concern over the inflation impact of the 7th Pay Commission report.

The 7th Pay Commission report, if implemented, could inflate the Centre’s salary and pension bill by close to a quarter or slightly over Rs 1 lakh crore in FY17, in what could be a big consumption stimulus but one that could undermine the government’s ability to step up public spending given the stiff fiscal deficit target of 3.5% of GDP for the year. The commission proposed a new pay matrix, replacing the existing pay bands and grade pay, for the Centre’s 50 lakh employees and 54 lakh pensioners, with a monthly starting pay, inclusive of dearness allowance (DA), of Rs 18,000 a month and apex pay of Rs 2.5 lakh.

7th Pay Commission report says the starting pay is Rs 7,000 per month now and the the highest pay is Rs 90,000 (fixed) excluding the DA, which is 119% at present.

“In percentage terms, the overall increase in pay and allowance and pensions over the business-as-usual scenario will be 23.55%,” the SCPC report, submitted to the finance minister by its chairman justice AK Mathur on Thursday, said. Within this, says 7th Pay Commission report, the increase in pay would be 16%, in allowances 63% (with the sharpest hike of 138.7% in house rent allowance) and and in pension, 23.6%. Of the Rs 1.02 lakh crore additional expenditure needed, Rs 73,650 crore would be via the Union Budget and Rs 28,450 crore routed through the Railway Budget.

7th Pay Commission: Top 10 highlights

The Centre’s total salary and pension bill, including that of railway employees who account for more than a third of its salary expenditure, will go up from Rs 4.33 lakh crore estimated otherwise to Rs 5.35 lakh crore in FY17. Of the SCPC package, Rs 2.8 lakh crore would be as pay (including DA), up Rs 39,100 crore. Expenditure on pensions would increase Rs 33,700 crore to Rs 1.76 lakh crore in the year.

salary

While the SCPC suggested abolition of the pay band and the grade pay introduced by the Sixth Pay Commission, it retained the annual increment of 3% and recommended a fitment factor of 2.57% that will be applied uniformly. The award will take effect from January 1, 2016. The government, sources said, is likely to announce the revised package in the next Budget, with retrospective effect.

The SCPC recommended an “equitable” pension, akin to one-rank-one-pension (OROP) announced for the armed forces, for civil employees including central armed police forces and defence personnel who retired before January 1, 2016. “This formulation will bring about complete parity of past pensioners with current retirees (for civilians those who joined service prior to January 1, 2004),” the report said.

7th Pay Commission report said all such retirees should first be fixed in the pay matrix being recommended by the SCPC, on the basis of the pay band and grade pay at which they retired, at the minimum of the corresponding level in the matrix. This amount should be raised, to arrive at the notional pay of the retiree, by adding the number of increments he/she had earned in that level while in service, at the rate of 3%. It said 50% of the total amount so arrived at shall be the revised pension. In the case of defence personnel, the total amount so arrived at will be inclusive of military service pay.

7th Pay Commission report also recommended enhancement in the ceiling of gratuity from the existing Rs 10 lakh to Rs 20 lakh. It said that as has been done in the case of allowances that are partially indexed to DA, the ceiling on gratuity may increase by 25% whenever DA rises by 50%.

On the contentious issues of bringing parity among civil services as IAS and IFS officers enjoy an edge in the current system, the commission members expressed different views. Justice Mathur said the two additional 3% increments being given to IAS over their basic pay at promotional stages be extended to the IPS and Indian Forest Service as well. Commission member Vivek Rae, a former IAS officer, did not agree with Mathur and said that the edge given to IAS was justified. Another member, economist Rathin Roy, sought the removal of the edge given to IAS and IFS officers.

Also, both Mathur and Roy recommended the two-year edge enjoyed by IAS for central staffing should be done away with to bring them on par with other Group A central services. Rae, however, did not agree.

In a largesse to the armed forces, the military service pay for service officers has been doubled to Rs 15,500 per month from Rs 6,000 currently; for nursing officers to Rs 10,800 from Rs 4,200; for JCO/ORs to Rs 5,200 from Rs 2,000; and for non-combatants to Rs 3,600 from Rs 1,000. Short-service commissioned officers will be allowed to exit the armed forces at any point in time between 7 and 10 years of service.

Analysts expressed concern over the inflation impact of the 7th Pay Commission report  — most state governments are expected to follow the SCPC proposals. Together, states governments employ close to 1.2 crore people. The Reserve Bank of India has set a medium-term inflation target of 4% by March 2018. The increased revenue productivity from the higher economic growth and the ushering in of the goods and services tax would give the government a handle to recoup higher amounts as taxes. The Centre’s income tax collections could get a significant boost from the SCPC and the states could benefit too given that 42% of the Centre’s gross tax revenue needs to be shared with them.

Percentage Increase:

1. Pay 244,300 283,400 39,100 16
2. Allowances
HRA 12,400 29,600 17,200 138.71
TPTA 9,900 9,900 0 0
Other Allowances 24,300 36,400 12100 49.79
3. Pension 142,600 176,300 33,700 23.63
TOTAL: 433,500 535,600 102,100 23.55

All figures in Rs crore except for percentage increase

  1. V
    Virendra Sason
    Nov 20, 2015 at 10:58 pm
    7th Pay Commission # Pay of Secretary GOI (increase) = 62.25% # Pay of Peon (increase)= 38.85% # Secretary GOI Peon # Basic Pay 80000=00 7000=00 # DA@119% 95280=00 8330=00# Total 175280=00 15330=00# Pay to be 1.1.16 225000=00 18000=00# Pay increase 49720=00 2720=00# % Increase on basic pay 62.25% 38.85%# Is it justified?
    Reply
  2. A
    Avinash Kumar
    Nov 20, 2015 at 11:43 am
    It is terrorism against the poor people of India. If government has money gives it to farmers, poor and people working in unorganized sector. Farmer’s works like animals and starving to death, in private and unorganized sector people are working 10 to 15 hours daily and not even able to full fill their basic needs. Don’t know what they want to achieve by giving these people who are already overladen with benefits of life time employment , Bribes, pensions , subsidies education and lot more.
    Reply
  3. A
    Avinash Kumar
    Nov 20, 2015 at 11:45 am
    It is terrorism against the poor people of India. If government has money gives it to farmers, poor and people working in unorganized sector. Farmer’s works like animals and starving to death, in private and unorganized sector people are working 10 to 15 hours daily and not even able to full fill their basic needs. Don’t know what they want to achieve by giving these people who are already overladen with benefits of life time employment , Bribes, pensions , subsidies education and lot more.
    Reply
  4. M
    M N
    Nov 20, 2015 at 11:38 am
    First show us the funds in your pocket and then talk about the rise. If you do not have funds, keep watch on your pockets.
    Reply
  5. P
    Palanivelu Somasundaram
    Nov 20, 2015 at 7:02 pm
    Life Like
    Reply
  6. P
    Palanivelu Somasundaram
    Nov 20, 2015 at 6:01 pm
    7 CPC
    Reply
  7. P
    Palanivelu Somasundaram
    Nov 20, 2015 at 7:01 pm
    Life Like
    Reply
  8. P
    Prabhat
    Nov 20, 2015 at 10:28 am
    Here goes all the money realized from increase in excise duty on Petroleum Products, Increase In Service Tax, Swachh Bharat Cess and many such taxes. The Aam Aadmi should get ready to cough up some more taxes to fund this bill of Government Employees who in any case do not depend on their ries for their survival. God bless India / Bharat / Hindustan...
    Reply
  9. K
    KARUNA
    Nov 20, 2015 at 11:24 am
    ALWAYS THE TAX PAYER'S CONSENT HAS TO BE OBTAINED. THESE PEOPLE HAVE TO FORM DISTRICT-WISE N. WITH A FEDERAL SET UP COMBINING ALL THOSE UNITS AT THE NATIONAL LEVEL. THE OPINION OF ALL THE NS HAVE A TO BE ELICITED BEFORE THE GOVT. ASK FOR THEIR OPINION PERMISSION AS THEIR MONEY IS MADE USE OF . ANY PROJECT OF CONSTRUCTION SHOULD ALSO BE SUPERVISED BY TAX-PAYERS ALONG WITH THE ENGINEERS. CORRUPTION CAN BE DETECTED AND PUNISHED FOR QUALITY WORK
    Reply
  10. R
    Raz David
    Nov 20, 2015 at 11:30 am
    **** I ( Deva Raj ) could be IAS / IPS Officer if i am not Computer engineer ******** **** I ( Deva Raj -- Hyderabad ) am State Topper, Comp., Engg., ex.PSU IT -- Executive, facing problem from some paid Criminal Employees ***** I can develop 100s of Facebooks, Twitters, better ERP than SAP, Oracle Apps.,; For the Last 17 Yrs., ( after my Comp., engg., ) i am NOT recruited by any SW company at Hyderabad, but i am forced to change 5 Org., in 5 Cities, in the span of 6 Yrs., just to KILL my family, there by my father Lost his life, Kids , parents, brothers every one suffered ;; Who will punish these dirty, Drinking , paid CRIMINAL SW employees ???? ????? We will BLAST OUT -- Accenture, SAP SE, IBM,TCS, Hewlet Packard ( HP ) Ltd., .. -- CLOSE your Business at HYDERABAD if the company is not able to provide a JOB to State RANKER, Computer Experts. Being State Topper, PSU IT -- Executive, i can develop better ERP than SAP, Oracle Apps.,; we will hang slates on CORRUPTED employees' necks to show the CORRUPTED qualification, ry and these PHOTOs will be displa in BUSstands, Railway Stations, Airports, famous Hotels, Cinema theaters, Junctions.. ; The Bad, Dirty, Drinking SW employees want our beautiful LADIES, Wives but can NOT work with the Talented GENTs ; Vedanta Resource Ltd ( BALCO ltd., ) --- IT deptt., recruited, promoted the dirty, drinking , Computer illiterates by forcing me to resign this PSU -- BALCO Ltd., we will punish them ;; SAMBIT DAS ( HEAD - HR-AR @ TECH MAHINDRA) --- Do you (Chemcha/ ) Donkey think that SW companies are UR G Fathers property ? you should be out of the SW companies; You are a FACTIONIST, CRIMINAL killed my father, to break families, to blame our relatives; First of all U should know the HUMAN power not the power, before working in HR deptt., Being a State Topper, PSU IT executive, I will filter OUT your CORRUPTED relatives, family from Hyderabad, Bangalore; Madhavi M ( AVP SAP--Hexaware Tech Ltd.) -- Is it a Charity home to pay RY to you without any Technical work ????? You join as my Subordinate and Let the Company's Govt. realize this. You can NOT develop a single program, can NOT configure any module, except CORRUPTION; You are a FACTIONIST, CRIMINAL killed my father, to break families, create fight among professionals; Being a State Topper, PSU IT executive, I will filter OUT your CORRUPTED relatives, family from Hyderabad, Bangalore; Inigo Anjalus ( PD SAP--Hexaware Tech Ltd.) -- Is it a Charity home to pay RY to you without any Technical work ????? You Psycho, CORRUPTED doing Regional, RELIGION CORRUPTION in SW companies ; you join as my Subordinate and Let the Company's Govt. realize this. Being a State Topper, PSU IT executive, I will filter out your corrupted relatives, family from Hyderabad, Bangalore; **** I could be IAS / IPS Officer if i am not Computer engineer ********
    Reply
  11. T
    t p
    Nov 20, 2015 at 10:30 am
    Tax payers money should not be wasted like this. Care for unemplo & well educated youth should be considered. Difference in minimum & maximum pay should not exceed 10 times. Minimum pay should be fixed at 14000/- Retirement age should be reduced to 55 year. Minimum age for any govt job should be 25 years. This would give chance to more citizens for govt job & reduce the gap between the rich & the poor.
    Reply
  12. U
    UDAI SIROHI
    Nov 20, 2015 at 11:37 am
    IT is absurd. so many educated youth are getting less.
    Reply
  13. U
    UDAI SIROHI
    Nov 20, 2015 at 11:40 am
    It is height of absurdity. highly educated youth are getting less. implementation of this pay commission shall lead to chaos and discrimination. should be done away with. taxpayers' money going to most inefficient people. My God help us save this country.
    Reply
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