Close on the heels of the Cabinet approving the recommendations of the Seventh Pay Commission, it had also announced an overall increase of 23.5 percent hike this year.
This initiative will ensure that over one crore government employees and pensioners will receive a hike that will reflect in their salaries for the month of August.
According to an official statement, the hikes will be paid with effect from 1 January 2016, while the arrears for the six months will be disbursed during the current financial year (2016-17) itself.
It may be noted that with regards to the 7th Pay Commission, the finance ministry provisioned Rs 70,000 crore to implement the recommendations of the committee headed by retired Justice A K Mathur.
One of the salient features of the move is the hike in the minimum monthly salary being raised from Rs 18,000 to Rs 23,500. The highest basic salary will be hiked from Rs 2,50,000 to Rs 3,25,000.
The other highlights of the Commission include new regulations that will ensure that there is no grade pay system. This will be replaced by the pay scale. One of the features of the new development is that the arrears will be given in one instalment.
The retirement age too is now at 60 years or 33 years of service, whichever is first applicable. Even as several employee unions raised their concerns about the centre's move, finance minister Arun Jaitley had stated, "“The fifth and sixth pay commissions had narrowed the gap between salaries paid in the private and government sectors…the seventh has moved further in the same direction".
This is in addition to the union government's official statement which read,
"“In the past, the employees had to wait for 19 months for the implementation of the Commission’s recommendations at the time of 5th CPC, and for 32 months at the time of implementation of 6th CPC. However, this time, 7th CPC recommendations are being implemented within 6 months from the due date. It will come into effect from 01.01.2016. The recommendations will benefit over 1 crore employees. This includes over 47 lakh central government employees and 53 lakh pensioners, of which 14 lakh employees and 18 lakh pensioners are from the defence forces.”
Even as a report by the panel said, “The Commission is proposing withholding of annual increments in the case of those employees who are not able to meet the benchmark either for MACP or a regular promotion within the first 20 years of their service. This will act as a deterrent for complacent and inefficient employees. However, since this is not a penalty, the norms for penal action in disciplinary cases involving withholding increments will not be applicable in such cases. This will be treated as an efficiency bar”.
In addition to the salary hike, the panel has also recommended to increase House Rent Allowance (HRA) to 27 percent, 18 percent and nine percent if the Dearness Allowance (DA) crosses 50 percent; and increment of 30 percent, 20 percent and 10 percent, when DA crosses 100 percent.
However, high-level committees will be set up to look into issues raised by various unions of central government employees on pay scales and other recommendations.
Employee unions have claimed that the recommended pay hike was the lowest in the last 70 years. They have also accused the government of announcing the awards "unilaterally" without any consultation with them
RSS-affiliate Bharatiya Mazdoor Sangh (BMS) and other trade unions have rejected the report, contending that it would increase disparity between the minimum and maximum pay.
Sources said, to examine the issues, four such committees will be deployed. One to look into implementation issues anticipated, another to check into the likely anomalies. The third group to further examine the recommendations on allowances, while the other fourth will suggest measures for streamlining the National Pension System.
