Published On: Tue, Dec 15th, 2015

Seventh Pay Commission: Govt to examine minimum pay

New Delhi: The central government is set to examine the minimum pay, which was recommended by the Seventh pay commission.

Finance Minister Arun Jaitley

Finance Minister Arun Jaitley

The Implementation cell of the Seventh pay commission recommendation in Finance Ministry is working hard to examine the minimum pay as the pay commission increased the pay gap between the minimum and maximum from existing 1:12 to 1: 13.8.

The government data shows that the pay panel recommended the lowest increase in basic pay i.e. 14.27 per cent since independence.

Sources in the Finance ministry said there appears to be a pattern of minimum pay not only a particular sector, but other segments are required to study as employees’s body and Trade Unions expressed resentment over the recommendations of the Seventh Pay Commission and demanded at least 40% hike in the pay of various categories of government employees.

“We found through government documentation, that are widely available, the preponderance of the evidence strongly supports the seventh pay commission report complexity.” said sources.

“But, that Implementation cell is concentrated as well on a range of different sectors like allowances, advances and risk-hardship matrix. So we need to look at those particular sections very closely.” he added.

The lowest paid central government employees will actually take home the lower salary than what they are currently drawing after acceptance of the Seventh Pay Commission report without modification.

A lowest paid central government employee, who was appointed in the Grade Pay of Rs 1800 in the end of 2015 in Group A city and he is residing in government- quarter. His will get net pay January 2016 Rs.16,370 in existing pay rules.

Illustration– Basic Pay = Pay Band Rs 5200 + Grade Pay Rs 1800= Rs 7000 + Expected DA of 125%, Rs 8750 + Transport Allowance with DA Rs.1350 = Gross Pay Rs. 17100

Deductions: NPS 10% of basic Pay = Rs 700 + CGEGIS Rs 30 = Total 730, Net Pay =17,100 – 730 = 16370

The same employee will get net pay in January 2016 under the Seventh Pay Commission recommendation without modification, Basic Pay Rs 18,000 – NPS 10% of basic Pay Rs 1800 – CGEGIS Rs 1500 = Rs 14,700. Accordingly, he will be a loser of Rs 1,670.

A minimum pay of Rs 18,000 per month and a maximum of Rs 2.5 lakh per month has been recommended by the Seventh pay commission, headed by Justice A K Mathur, that presented its 900-page report to Finance Minister Arun Jaitley on November 19.

The The Seventh Pay Commission recommended raise in basic pay, a key segment that determines several allowances, is only 14.27 per cent – the lowest in 70 years. The previous commission had recommended a 20 per cent hike, which the government doubled while implementing it in 2008.

The Commission recommended a 23.55 per cent increase in the cumulative earnings of central government employees.

The figure of 23.55 per cent covers the increases in pay and allowances.

The overall increase in pay and allowances and pensions over the business-as-usual scenario will be 23.55 per cent, the report said.


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