Pay Commission hike likely to be hefty

A Committee of Secretaries headed by Cabinet Secretary PK Sinha has submitted its report on the recommendations of the Seventh Pay Commission which may be accepted, a financial ministry official said. Based on the panel’s report, the Finance Ministry is preparing a Cabinet note and the issue may come up for approval by the Cabinet as early as June 29. “Committee of Secretaries (CoS) has finalised its report on Pay Commission recommendations. We will soon (file) draft Cabinet note based on the report,” Finance Secretary Ashok Lavasa said here on Monday. 

The government had, in January, set up a high-powered panel headed by the Cabinet Secretary to process the recommendations of the Pay Commission which will have bearing on the remuneration of nearly 50 lakh central government employees and 58 lakh pensioners. The Pay Commission had recommended 23.55 per cent overall hike in salaries, allowances and pension involving an additional burden of Rs 1.02 lakh crore or nearly 0.7 per cent of the GDP. The panel recommended a 14.27 per cent increase in basic pay, the lowest in 70 years. The previous Sixth 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 the 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. 

Around Rs 70,000 crore has been provisioned for it, officials said. Lavasa said the Seventh Pay Commission report will be effective from January 1.