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Wednesday, 2 December 2015

Government likely to hike minimum pay Rs 20,000; not to abolish any advance, allowance

Government likely to hike minimum pay Rs 20,000; not to abolish any advance, allowance


New Delhi: The government is likely to give minimum basic salary Rs 20,000 of central government employees while the Seventh pay commission recommended fixing the lowest at Rs 18,000 for the central government employees on its report which was submitted to Finance Minister Arun Jaitley on November 19 by Justice A K Mathur, who heads the seventh pay commission.

An official of Expenditure Department Cell For implementation of Pay Commission recommendations said the government wants to make up pay gap between employees and higher officers and to hike Basic salary at least Rs 20,000 from Rs 18,000 recommended by the Seventh pay commission,

The government has no intention to cut current allowances and advances of any employees. the government motto is betterment must be done by protecting the current advances and allowances.

The Seventh pay commission has recommended for abolition of various allowances and advances like risk allowance, small family allowance, festival advance, motor cycle advance, he added.

He also said the government may not suggest any curtailment of the allowances and advances being now enjoyed by the central government employees, and the gazette of the pay hike, which is coming within six months, also would not do it.

The central government employees at various levels have been complaining of the abolition of the various allowances and advances.

They also termed the Seventh Pay Commission report as a width pay gap discrimination between employees and higher officers because in its report, the Pay Commission has recommended to increase the pay gap between the minimum and maximum from existing 1:12 to 1: 13.8

Every pay commissions made up pay gap between employees and higher officers from second Pay Commission 1:41 ratio to Sixth pay commission 1:12.

TST
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7th Pay Commission award not to upset fiscal roadmap: RBI Governor

7th Pay Commission award not to upset fiscal roadmap: RBI Governor


Mumbai: RBI Governor Raghuram Rajan today said the Seventh Pay Commission recommendations will not upset fiscal maths as additional expenditures will be offset by either surplus revenues or expenditure cuts.

In the fifth bi-monthly monetary policy review for 2015-16, the Reserve Bank said the implementation of the Pay Commission proposals, and its effect on wages and rents, would be factored in by the RBI in its future deliberations.

“In the broad sense, yes there is going to be additional expenditure, but that will be offset presumably by either additional revenues raising or cuts elsewhere so that the fiscal consolidation path is maintained,” Rajan said while addressing reporters after the monetary policy statement.

The 7th Pay Commission has recommended increase in remuneration of about one crore government employees and pensioners which is estimated to impose an additional burden of Rs 1.02 lakh crore on the exchequer in 2016-17.

The new pay scales, subject to acceptance by government, will come into effect from January 1, 2016.

Rajan said the government had anticipated the consequences of Pay Commission recommendations and hence the fiscal path is expected to be maintained.

“We don’t feel there will be a significant effect on aggregate demand provided you maintain the fiscal path. Of course, investment in some ways may be (of) higher quality than certain kind of spending and therefore one would hope that you would uncover space elsewhere for the public investment which we really need,” Rajan added.

In the monetary policy statement, RBI said the direct effect of Pay Commission implementation and its “effect on aggregate demand is likely to be offset by appropriate budgetary tightening as the government stays on the fiscal consolidation path”.

The government had unveiled a fiscal consolidation roadmap in 2015-16 Budget under which fiscal deficit was to be brought down to 3.9 per cent of GDP this fiscal, 3.5 per cent in 2016-17 and 3 per cent by 2017-18, respectively.

Fiscal deficit in 2014-15 was 4 per cent of GDP.

RBI Deputy Governor Urjit Patel said the increase in the House Rent Allowance of central government employees post Pay panel award would get reflected in the retail inflation data.

“But that is a one time level change and unless there are wider externalities, we will most likely look through that…

The impact will be felt from April onwards for 6-8 months. You will see an index change, but that will likely be looked through by RBI,” Patel said.

Several rating agencies and brokerages have said that a proposed 23.6 per cent hike in salaries and pensions of government employees could hurt India’s finances.

PTI
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One Rank One Pension – Payments Expected to Start in January

One Rank One Pension – Payments Expected to Start in January

The Ministry of Defence, meanwhile, is rethinking whether it should debar officers and men who go home before completing their tenure from the benefits of OROP.

About 25 lakh armed forces veterans get their first enhanced pension under the One Rank One Pension Scheme, or OROP,  in January, top Ministry of Defence officials said. The enhanced pensions will cost the exchequer around Rs. 7,000 crore.

The Ministry of Defence, meanwhile, is rethinking whether it should debar officers and men who go home before completing their tenure from the benefits of OROP.

About 80% officers and men leave the forces when they fail to make it to the next rank. The benefits of the current scheme are denied to them. For example, a Colonel who leaves the army before completing his tenure as he didn’t make it to the next rung – Brigadier – will not be entitled to OROP.

But sources said Defence Minister Manohar Parrikar has ordered a rethink on this and is inclined to strike this provision off.

If done, it would address one of the major concerns of the armed forces.

“If officers who leave their tenure incomplete and quit for not being making it to the next rung are denied OROP, the forces will be saddled with passed over officers. Worse, they will have to work under the command of junior officers,” a source in the ministry said.

Veterans will also get their OROP arrears – the scheme has been brought into effect from July 2014 – before the end of this financial year. It will cost the government Rs. 11,000 crore.

War widows and Gallantry award winners will their arrears in one go – the rest will get it in four equal installments.

The implementation of OROP – a pre-election promise by the BJP – was announced this September after prolonged negotiations.

The scheme could, however, not be implemented immediately because of the Bihar elections and the model Code of Conduct that came into play during elections.

Source: NDTV
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