Published On: Wed, Aug 23rd, 2017

7th Pay Commission arrears hurt employees finances

New Delhi: Central government government employees’ fiscal position has not been impacted by the arrears of 7th Pay Commission recommendations.

Finance Minister Arun Jaitley has not given any arrears on allowance which have been implemented from July this year.

Finance Minister Arun Jaitley has not given any arrears on allowance which have been implemented from July this year.

The government put the final seal of approval on the 7th pay commission recommendations on July 25, 2016.

As per the notification and resolution, central government employees have received an average 14.27 per cent hike in basic pay effective from January 1, 2016, meaning that the government has also paid them arrears for the past seven months as employees got the revised pay from their August salaries.

The previous 6th Pay Commission had recommended a 20 per cent hike which the government doubled while implementing it in 2008.

The hype around the 7th Pay Commission recommendations was completely unnecessary, as the real impact was going to be much lesser both in absolute and relative terms compared with the previous 6th Pay Commission. As such, the employees didn’t take it as any effect has been made on their finances.

One of the biggest reasons this pay hike has not made an impact that the 6th pay commission had given more amount than this.

Last time, due to the delay in setting up the panel in the first place, the hike that was to be implemented by January 1, 2006 saw the light of the day only from January 1, 2008, making the government’s arrears payment that much larger.

Secondly, the 6th pay commission had recommended a hike of 20 percent but UPA government had given unilaterally a hike of over 40 percent. The 7th Pay Commission recommended a hike of 14.27 percent, but Modi Government didn’t increase it and went with ditto to the 7th Pay Commission, which makes a big impact on arrears.

Thirdly, the arrears can make the impact on employees finances not the regular pay hike.

Fourthly, Dearness Allowance (DA) had been counted fifth times in the calculation of the pay hike back in 2008, making the actual bigger the employees finances.

The arrears of hike in basic pay is usually only paid. No arrears for allowances (except Dearness Allowance) was paid, as per usual practice, the allowances is paid from the date of implementation.

The arrears of hike in basic pay under the 7th pay commission recommendation has been paid in one go during the financial year 2016-2017, according to the Office Memorandum No.1-5/2016-IC.

However, Finance Minister Arun Jaitley has not given any arrears on allowance which have been implemented from July this year.

TST

About the Author