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Pay panel recommends 23.55% salary hike for Central staff

Finance Minister Arun Jaitley receiving the report of Seventh Pay Commission from its Chairman Justice A K Mathur in New Delhi on Thursday. (PTI)
Finance Minister Arun Jaitley receiving the report of Seventh Pay Commission from its Chairman Justice A K Mathur in New Delhi on Thursday. (PTI)

New Delhi: A 23.55 per cent hike in salary, allowances and pension involving an additional burden of Rs 1.02 lakh crore has been recommended to central government employees and pensioners by the 7th Pay Commission which more than doubled the entry and top level pay while favouring a virtual OROP for civilians.
The recommendations that will benefit 47 lakh Central government employees and 52 lakh pensioners, which will impact the Central Budget by Rs 73,650 crore and the Railway Budget by Rs 28,450 crore.
The 900-page report of the 7th Pay Commission headed by Justice A K Mathur was presented to Finance Minister Arun Jaitley with a recommendation that the new scales be implemented from January 1 next year.
The panel recommended a 14.27 per cent increase in basic pay, the lowest in 70 years. The previous 6th Pay Commission had recommended a 20 per cent hike which the government doubled while implementing it in 2008.
The 23.55 per cent increase includes hike in allowances.
The entry level pay has been recommended to be raised to Rs 18,000 per month from current Rs 7,000 while the maximum pay, drawn by the Cabinet Secretary, has been fixed at Rs 2.5 lakh per month from current Rs 90,000. For the Secretaries it has been fixed at Rs 2.25 lakh as against Rs 80,000 currently.
In a significant recommendation, the report favoured introduction of a health insurance insurance scheme for staff and pensioners and doubling the gratuity ceiling to Rs 20 lakh. The award of the pay panel will also benefit staff of autonomous bodies, universities and public sector units, Jaitley said after receiving the report.
He said the impact of the recommendations would be an increase of 0.65 percentage on expenditure on salaries to GDP compared to 0.77 per cent in 6th Pay Commission.
The report will be studied by a secretariat headed by Expenditure Secretary before government takes a decision. “In percentage terms, the overall increase in pay and allowance and pensions over the business-as-usual scenario will be 23.55 per cent,” the report said. Within this, the increase in pay will be 16 per cent, in allowances 63 per cent and in pension would be 24 per cent, it said. (PTI)

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