New Delhi: Central government employees are in a pessimistic mood after their long-awaited 7th pay commission’s salary hike was finally approved by the Union Cabinet, which is likely to see a higher increase in the basic pay by average 14.29 percent, which is the lowest in 70 years.
Union Finance Minister Arun Jaitley said government salaries have to be competitive with the private sector, for which the Commission had engaged IIM-Ahmedabad to make the comparison.
The minimum monthly wage has been increased from Rs 7000 to Rs 18,000, while the starting salary of a newly-recruited employee at the lowest level will now be Rs 18,000, and a Class I officer will get Rs 56,100.
However, Union Finance Minister Arun Jaitley said government salaries have to be competitive with the private sector, for which the Commission had engaged IIM-Ahmedabad to make the comparison.
“This will attract best talent in the government sector,” said the minister.
Maintaining that government cannot grudge a hike in salary for government staff after 10 years, he said: “When people get more money, it comes back in the system in the form of taxation. Savings will increase … spending will go up.”
The Cabinet, however, deferred the proposed revision in allowances, so they hiked salaries and pension but they didn’t hike allowances, which will be hiked in future.
A committee headed by Finance Secretary Ashok Lavasa will look into hike in allowances. The Committee will complete its work in a time bound manner and submit its reports within a period of 4 months. Till a final decision, all existing Allowances will continue to be paid at the existing rates. This will help cushion impact on government finances.
The Cabinet ditto with the 7h Pay Commission recommendations, the commission recommended 23.55 per cent hike in salaries, allowances and pensions and a 14.27 per cent increase in basic pay for Central government employees, the lowest in 70 years.
The central government employees are in for disappointment as the cabinet approved a 14.27 per cent hike in basic pay, which is significantly lower than what the 6th pay commission had recommended. Sixth Pay Commission had recommended a 20 per cent hike in basic pay which the government doubled while implementing it in 2008.
Empowered Committee of Secretaries (CoS) headed by Cabinet Secretary P K Sinha for processing the report of the 7th Pay Commission proposed a 30 per cent increase in basic pay with raising minimum pay at Rs 23,500 a month and maximum salary of Rs 3.25 lakh but the cabinet rejected it.
The cabinet did not accept any word of the Empowered Committee of Secretaries. So, why did government make it? Did it make for time killing?
The central government employees Unions leaders on Wednesday said the approved hike was lowest in many decades and were not in sync with inflation. They also said it is “totally disappointing and beats logic”.
Accordingly, they rejected the 7th Pay Commission approved by the government and threatened to go on strike.
Congress Chief spokesman Randeep Surjewala said that the hike in 7th Pay Commission is the “lowest in the last seven decades”. He added the hike in salaries and allowances is a mere 15 per cent on basic pay and not 23.5 per cent as is being wrongly claimed by the government.
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