7th Pay Commission Has Less To Take-Home, More Allowances

The recommendations, which were approved by the cabinet on Wednesday, is likely to see a higher increase in the basic pay by almost 15 percent for over one crore government employees and pensioners.

The recommendations were approved by the Cabinet yesterday on 29 June, 2016 affecting almost one crore government employees and pensioners. Not accepting the Pay Commission’s recommendation to reduce as many as 196 kinds of allowances the government employees get, the Cabinet constituted a committee headed by the finance secretary for further rationalisation of allowances and asked for its report within four months.

The hike is going to increase the disposable income of the government employees leading to an increase in consumption.

The 900-page report also recommended a minimum monthly pay of Rs 18,000 (up from the current Rs 7,000) and a maximum monthly pay of Rs 2.5 lakh (up from Rs 90,000).

The central government employees unions to use the strike as a bargaining chip to hike their pay and allowance under 7th Pay Commission award.

The Finance Minister said the government is “not surprised” at the additional expenditure, which is estimated at Rs 102,100 crore as per official estimates.

Shortly after the meeting of the Cabinet, Finance Minister Arun Jaitley congratula- ted the central government officers, employees and pensioners.

Pay Commission is a panel which is constituted by the government of India which will give recommendations regarding changes in salary structure of government employees.

The Seventh Pay Commission’s recommendations were approved by the Cabinet today.

The Cabinet on Wednesday cleared all the recommendations of the 7 Pay Commission. The fiscal impact of the arrears of the sixth pay commission was so onerous that it was spread over two fiscals, FY10 and FY11.

“The revised salaries of central government employees are likely to be paid from 1 July 2016”. The gratuity ceiling will be increased from Rs 10 lakh to Rs 20 lakh, whereas housing allowance will now be Rs 25 lakh as opposed to the existing Rs 7.5 lakh.

“Since independence seven Pay Commissions have been constituted all by Congress or Congress-led Governments”.