7th Pay Commission recommendations approved by Cabinet; cash bonanza for 1 crore government employees

By: | Updated: June 29, 2016 1:54 PM

7th Pay Commission recommendations have been approved by PM Narendra Modi-led cabinet today and it's a news that will greatly cheer one crore government employees

7th Pay Commission, 7th Pay Commission latest news, 7th Pay Commission Cabinet, 7th Pay Commission hike7th Pay Commission hike: The government has approved a minimum pay hike of 20% and a maximum of 25%.

7th Pay Commission recommendations have been approved by PM Narendra Modi-led cabinet today and it’s a news that will greatly cheer one crore government employees! The acceptance of 7th Pay Commission recommendations will also be a big boost for consumption demand in the economy.

The government has approved a minimum pay hike of 20% and a maximum of 25%. The 7th Pay Commission’s recommendations are effective from January 1, 2016.

The pay panel had in November last year recommended 14.27 per cent hike in basic pay at junior levels, the lowest in 70 years. In percentage terms the overall increase in pay & allowances and pensions will be 23.55 per cent. In finer details, the increase in pay is slated to be 16 per cent, increase in allowances will be 63 per cent, and increase in pension would be 24 per cent, the recommendations said.

Also read: 7th Pay Commission approved: 15 stocks to buy with increased salary

The minimum pay in government has been recommended at Rs 18,000 per month. A maximum 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 have been recommended.

Soon after the news came in, FM Arun Jaitley tweeted, “Congratulations to central government officers, employees & pensioners on a historic rise in their salary & allowances through the 7th CPC.”

According to a government official the total impact of the 7th Pay Commission will be Rs 1.02 lakh crore. According to the recommendations, out of the total financial impact of Rs 1,02,100 crore, Rs 73,650 crore will be borne by the Union Budget and Rs 28,450 crore by the Railway Budget.

The move is estimated to benefit nearly 10 million government employees. The government is expected to hold a briefing on this later in the day.

7th Pay Commission Head told a news channel that the government will be able to contain panel recommended payout. “Likely rise in sale of consumer durables may have inflationary impact,” he said.

The recommendations were submitted by the Empowered Committee of Secretaries, which was formed to look into recommendations of the Seventh Pay Commission.

Also check: 7th Pay Commission highlights: All you want to know in infographics

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, which is expected to change the remuneration of 47 lakh central government employees and 52 lakh pensioners.

Also read: 7th Pay Commission approved by Cabinet; Real estate sector may get a boost, Bengaluru, Pune among best bets

While this year’s Budget did not provide an explicit provision for implementation of the 7th Pay Commission, the government had said the once-in-a-decade pay hike for government employees has been built in as interim allocation for different ministries.

(With inputs from Agencies)

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