The Seventh Pay Commission, chaired by Justice A.K. Mathur, will submit to Union Finance Minister Arun Jaitley on Thursday recommendations for an average 15-16 per cent increase in pay, allowances and pensions for Central government employees, lower than the 20 per cent suggested by the Sixth Pay Commission on the basis of which the then government revised the pay scales by nearly 40 per cent with effect from 2006.
“The less generous recommendation reflects that the economy isn’t booming now as it was then,” a member of the Commission told The Hindu. The Modi government is expected to revise pays, pensions and allowances, on the basis of the Seventh Pay Commission’s recommendations, with effect from January 1, 2016, for 48 lakh employees and 54 lakh pensioners.
Top sources told The Hindu that the report could not reach an agreement on “controversial” issues such as if and how the edge the IAS and the IFS officers enjoyed over other services should be maintained, and the report included multiple dissent notes from its members.
The chairman has recommended that the current practice — in which the pays of all officers recruited in a particular year are upgraded within two years of the first officer of the batch getting promotion — be extended to all services, including defence and central paramilitary services. The dissenting member, however, has suggested that the government get rid of this rule so that pay upgrade for officers, including IAS and IFS, should come off only after they themselves get promoted rather than within two years of the promotion of the first officer of their batch. Another dissenting member has recommended status quo.
On the empanelment of officers above the level of joint secretary for deputation to the Centre, the chairman and a member have recommended that officers of non-IAS and non-IFS services of a batch be considered. But the dissenting member suggested maintaining status quo.
The commission will also submit a recommendation on an alternative approach to the one rank one pension for defence personnel.
The cost of the recommendations, if accepted by the Centre, works out to 0.6% of the GDP in the first year of implementation, lower than that of the Sixth Pay Commission, which was 0.77%. In nominal terms, the rise is more than Rs. 1 lakh crore against the nearly Rs.18,000 crore following the Sixth Pay Commission’s award, which also resulted in additional arrears of Rs.30,000 crore. The per month ‘cost to company’ for the Centre will rise to Rs.4 lakh crore.
However, as percentage of the revenue expenditure, the cost is put at 18.5 per cent of the estimate in the budget for the current year. It was 22.3 per cent for the first year of the implementation of the Sixth Pay Commission.
In the report to be submitted on Thursday, the commission has also recommended substantial rises in the HRA to officers in lieu of government accommodation.
