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7th Pay Commission report submitted to Union Finance Minister
Posted on: 20/Nov/2015 9:56:56 AM
The recommendations made by the Seventh Central Pay Commission will come into effect on January 1, 2016. The Commission submitted its report to Union Finance Minister Arun Jaitley on Thursday. In it, the Commission has recommended 23.5% hike in basic pay, allowance and pensions for central government employees. This includes a 16% increase in basic pay, 63% increase in allowances and 24% increase in pensions.
Speaking about this, Mr. Jaitley has said, This will impact 47 lakh employees and 52 lakh pensioners. The total monetary impact on the central government would be Rs 1.02 lakh crore. Around Rs 74,000 crore would be the impact on the Union Budget and Rs 28,000 crore on the Railway Budget. The impact of the recommendations amounts to 0.6 per cent of GDP. While the government would review the report soon, the State governments would take their own view on it.
Justice A.K. Mathur, Chairman of the Commission, has said, The Commission recommends a revised pension formulation for civil employees including CAPF personnel as well as for Defence personnel, who have retired before January 1, 2016. This formulation will bring about parity between past pensioners and current retirees for the same length of service in the pay scale at the time of retirement.
The report has also addressed the issue of Grade Pay. 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. it said.
The Commission has also recommended a foment factor of 2.57 for all employees. In this, the pay will have a one time increase of 2.57 times uniformly for all employees. Based on the Aykroyd formula, the minimum pay in government is recommended to be set at Rs. 18,000 per month and 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, says the report.
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