A complete reference blog for Indian Government Employees

Tuesday 23 February 2016

7th CPC Recommendations on Minimum Pay Calculation – Reports Step by Step

7th CPC Recommendations on Minimum Pay Calculation – Reports Step by Step

The Commission has estimated the minimum pay (the calculations for which have been tabulated in the Annexure) through the following steps:

Step 1 : The food, clothing and detergent products listed and their respective quantities specified by the 15th ILC have been adopted. These quantities indicate the monthly consumption of the listed products by a family comprising three consumption units. [For e.g. for the product ‘Dal’ the quantity specified for daily consumption is 80 grams per consumption unit per day. The monthly consumption of Dal by a consumption unit thus works out to 2.4 kg (80 x 30). Accordingly the monthly consumption of Dal by a family comprising 3 units is 7.2 kgs (2.4 x 3).]

Step 2 : The quantities have been multiplied by their respective product prices to arrive at product wise cost. The price adopted for each product is the average of prices of various items that are included in the product. The price of an item is the average of its prices prevailing in each month from July, 2014-June, 2015. [At monthly family consumption of 7.2 kg the Commission has estimated the monthly expenditure on Dal at Rs.704.44 after calculating the price of Dal at Rs.97.84 per kg. The price of Dal has been calculated as the average of prices of Toor, Urad and Moong Dal items specified under the product Dal and whose prices have been determined at Rs.87.86, Rs.109.66 and Rs.96.00 respectively. The prices of these three Dal items are the twelve monthly average prices for the period July, 2014–June, 2015.] The prices of all items have been sourced from Labor Bureau, Shimla. These prices are used in the calculation of the CPI (IW) and subsequently the calculation of Dearness Allowance. In the current exercise the prices of all items are for the period July 2014-June 2015 and have been used in the calculation of DA at 119 percent operative from 01.07.2015.

Step 3 : The cost of food, clothing and detergent products obtained from Step 2 has been divided by 0.8 to arrive at a total, of which 20 percent provides for fuel and lighting expenses. This addresses the fifth component under para 4.2.3. The fourth component on housing under para 4.2.3 has not been addressed at this stage as its quantification at the final stage of pay estimation is considered more appropriate by the Commission.

Step 4 : The cost estimated from Step 3 is divided by 0.85 to arrive at a total, of which 15 percent is towards recreation, ceremonies and festivities. The prescribed provision of  25 percent to cover education, recreation, ceremonies, festivals and medical expenses has been moderated to 15 percent because expenses on educational and medical necessities are being separately provided for through relevant allowances and facilities and thus need not be provided here. This partially addresses the first of the two components outside the 15th ILC norms.

Step 5 : The cost estimated from Step 4 is increased by 25 percent to account for the skill factor, following the reasoning that there is no unskilled staff in the government after the merger of Group D staff in Group `C’. This addresses the second of the two components outside the 15th ILC norms.

Step 6 : The cost estimated from Step 5 is divided by 0.97 to arrive at a total, of which 3 percent provides for housing expenses. This is done in view of the observation that license fees for government accommodation is about 3 percent of the total pay. This addresses the fourth component stated under para 3 but partially so, as the 15th ILC norms had fixed the housing provision at 7.5 percent.

Step 7 : The cost estimated from Step 6 is as on 1 July, 2015 when the DA was 119 percent. The DA is assumed to be 125 percent as on 1 January, 2016, the day from which the Commission expects its recommendations to be implemented by the government.

Accordingly the cost estimated from Step 6 has been increased by 3 percent (2.25/2.19 = 1.027 or nearly 3%).

Minimum-Wage-Calculation-by-7th-CPC

Authority: http://7cpc.india.gov.in/pdf/sevencpcreport.pdf
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Accumulation of Leave on Average Pay (LAP) by the employees – Advance Correction Slip No. 78 of IREC Vol.I. (1985 Edition) reprint Edition of 1995.

Accumulation of Leave on Average Pay (LAP) by the employees – Advance Correction Slip No. 78 of IREC Vol.I. (1985 Edition) reprint Edition of 1995.

LAP-earned-leave-average-pay


NFIR
National Federation of Indian Railwaymen
3, CHELMSFORD ROAD, NEW DELHI – 110055
Affiliated to:
Indian National Trade Union Congress (INTUC)
International Transport Workers’ Federation (ITF)
No. II/10
Dated: 22/02/2016
The Secretary(E),
Railway Board,
New Delhi

Dear Sir,

Sub: Accumulation of Leave on Average Pay (LAP) by the employees – Advance Correction Slip No. 78 of IREC Vol.I. (1985 Edition) reprint Edition of 1995.

Ref: (i) NFIR’s PNM item No.5/2010.
(ii) Railway Board’s letter No. E(P&A)I-2010/FE-4/2 dated 05/07/2013 addressed to GS/NFIR.
*********
With reference to above, the Federation encloses herewith a copy of its letter of even number dated 22/02/2016 addressed to the DOP&T seeking review of the case as the situations in the Railways are different.

NFIR requests the Railway Board to pursue the matter again with the Ministry of Personnel (DoP&T) at appropriate higher level for obtaining special dispensation so that leave can be got accumulated beyound 300 days by the Railway employees. A copy of the proposal being sent to the DoP&T may be endorsed to the Federation for taking follow up action.

DA/As above
Yours faithfully,
(Dr. M. Raghavaiah)
General Secreatary
Copy to the General Secretaries of affiliated Unions of NFIR.
Media Centre/NFIR.
File No.05/2010 (PNM).

Accumulation of Earned Leave/Leave on Average Pay (LAP) beyound 300 days.

No. 13012/I/2010-Est (L)
Department of Personnel and Training
Establishment(Leave) Section
**********
New Delhi, the 24th September, 2012

OFFICE MEMORANDUM

Subject: Accumulation of Earned Leave/Leave on Average Pay (LAP) beyound 300 days.

The Undersigned is directed to refer to Ministry of Railways (Railway Board) O.M.No. E(P&A)I-2010/FE-4/2 dated 10.9.2012 on the above subject and to say that proposal therein is not agreed to as the justification given for the same is not satisfactory. When due leave is not even being availed and accumulations are lapsing there does not seem to be any case for further compounding such unavailed accumulations.

Further the Govt. Policy under lying the CCS (Leave) Rules, 1972 is to encourage Government servant to break the monotony of routine work through periodical savvaticals and balancing the same against the demand of public interest & exigencies. Ministry of Railways is requested to revisit their policy of grant of leave, so that the workforce is not denied leave in cases of acute personal needs and also be encouraged for periodic time off.
(Rishi Pal)
Section Officer
Ministry of Railways
(Shri K.Shankar, Dir.Estt.(P&A)
Railway Board
Room No.337-A, Pragati Madan
New Delhi

Source: NFIR
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Review report on Pay Commission recommendations likely by April-end

Review report on Pay Commission recommendations likely by April-end

The Empowered Committee of Secretaries, headed by Cabinet Secretary P K Sinha on the 7th Pay Commission’s recommendations is expected to submit its review report to the Finance Ministry by April end, official sources said.

“The reports is still in the process of finalisation by the the Implementation Cell of the Pay Commission, which has been created in the Finance Ministry to work as the Secretariat of the Empowered Committee.
After processing, it is likely to be received in the Empowered Committee of Secretaries by the April,” the official said.

“After submission of the report by the Implementation Cell, the report would be examined by the Empowered Committee for cabinet nod immediately,” he added.

The Empowered Committee will go into the service conditions of central government employees, salaries and allowances and suggest changes as considered necessary on the pay commission recommendation, they confirmed.

Finance Ministries officials told us the salaries of central government employees might see a increase due the Seventh Pay Commission made a width pay gap discrimination between employees and higher officers from existing 1:12 to 1: 13.8 and the Implementation Cell is receiving employees’ associations approval to decrease the pat gap.

7th Pay Commission has not been properly reviewed the pay gap between minimum and maximum pay, the association pointed. They said in their representation that every pay commission made up pay gap between employees and higher officers from second Pay Commission 1:41 ratio to Sixth pay commission 1:12.

They strongly opposed 14.27 per cent increase in basic pay, which was recommended by the 7th Pay Commission. They said sixth pay commission had recommend 20 per cent increase in basic pay, which was better than current pay commission.

The government doubled the sixth pay commission recommendation to increase in basic pay while implementing it in 2008 for boosting central government employees.

Accordingly the associations are pressing hard to double the percentage of pay hikes what the 7th Pay Commission recommended with examining the all previous pay commissions’ reports.

The government may take positive on above suggestions of associations to improve the financial health of the central government employees. These steps will have to motivate the government employees to better work culture in government offices.

So, the Prime Minister’s Office (PMO) asked the secretaries Committee to process on this way soon.
A populist budget, ahead of assembly elections in Kerala, Assam, West Bengal, Tamil Nadu and Puducherry, this year, Finance Minister Arun Jaitley presents February 29 and which is expected to implement the recommendations of 7th Pay Commission to raise pay and pension for 48 lakh central government employees and 52 lakh pensioners, which will result in an additional annual burden of Rs 1.02 lakh crore on exchequer.
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Re-Scheduling of Summer Vacation in Kendriya Vidyalaya Schools

Re-Scheduling of Summer Vacation in Kendriya Vidyalaya Schools 

KV schools in Ahmedabad, Mumbai, Bangalore, Chennai, Hyderabad, Jabalpur, Raipur, Bhubaneswar and Kolkata including A&N Islands to close for vacation from 3rd May 2016 from 21st June 2016

Re-Scheduling of Summer Vacation for Kendriya Vidyalayas in Ahmedabad, Mumbai, Bangalore, Chennai, Ernakulam, Hyderabad, Jabalpur, Raipur, Bhubaneswar and Kolkata including A&N Islands region of – KVS Order

KENDRIYA VIDYALAYA SANGATHAN
18, Institutional Area, shaheed Jeet Singh Marg
New Delhi 110 016
F.110334/1/2012-KVS HQ/Acad/Pt File II
Date: 12-02-2016
OFFICE ORDER

In continuation to this office letter of even number dated 23.12.2015, it has been decided by the competent authority to Re-Schedule Summer Vacation of Ernakulam, Ahmedabad, Mumbai, Bangalore, Chennai, Hyderabad, Jabalpur, Raipur, Bhubaneswar and Kolkata including A & N Islands) for the Session 2016-17 as under:

Name of Regional Office/Offices
Existing Schedule of Summer vacation for Session 2016-17
Changed Schedule of summer vacation for session 2016-17
Ernakulam From 25.04.2016 (Monday) to 13.06.2016 (Monday) – 50 days From 09.04.2016 (Saturday) to 29.05.2016 (Sunday) – 50 days
Ahmedabad, Mumbai, Bangalore, Chennai, Hyderabad, Jabalpur, Raipur, Bhubaneswar and Kolkata including A&N Islands From 25.04.2016 (Monday) to 13.06.2016 (Monday) – 50 days From 03.05.2016 (Tuesday) to 21.06.2016 (Tuesday) – 50 days.
Other details of the said letter will remain the same.
(Dr Shachi Kant)
Joint Commissioner (Trg.)
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7th Pay Commission Latest News – Railways Senior Citizens Welfare Society’s Memorandum

7th Pay Commission Latest News – Railways Senior Citizens Welfare Society’s Memorandum

RSCWS demands for revising 7th pay commission multiplication factor, Parity of Pension, and revision of Fixed Medical Allowance – Submits memorandum to 7th pay commission empowered committee

7th Pay Commission Latest News – Railway Senior Citizen Welfare Society has submitted representation to 7th Pay Commission Implementation Cell highlighting the need for reviewing the recommendations for the benefit of Pensioners

No. RSCWS/ CHD / Memo 7th CPC Emp Com/2016-3
Dated: 6-2-2016
1. Cabinet Secretary, Government of India & CHAIRMAN, EMPOWERED COMMITTEE OF SECRETARIES ON 7TH CPC, Cabinet Secretariat, Rashtrapati Bhawan, New Delhi – 110 004
CC to:cabinet@nic.in

2. ALL MEMBERS OF EMPOWERED COMMITTEE ON 7TH CPC

Dear Sir,
Subject: Recommendations of the 7th Pay Commission relating to Pension & Retirement Benefits

We would like to draw your kind attention to the following major points & serious inadequacies & consequential serious injustice to the Pensioners. We earnestly request you for consideration of the following issues:

1. MULTIPLE FACTOR (REF: PARA 10.1.67):

I) The 7th Pay Commission has very unjustly & arbitrarily recommended the multiple factor of 2.57 for fixation of Pay & Pension. It is tantamount to less than 14.3% rise of emoluments as on 1-1-2016 (with expected DA of 125%) as against over 21% rise proposed by 6th CPC. This is especially very much unjustified in view of much high price rise in the last 10 years.

II) Long pending demand may please be accepted for merger of DA for fixing the Revised Pay & Pension;

III) It is, therefore, requested that the multiple factor should, therefore, be raised to 3.15 times of Sixth CPC Basic Pay & Pension if the merger of DA is agreed to or at least to 2.65 if merger of DA is not agreed to.

IV) The Minimum wage of Rs.18000 proposed by 7th Pay Commission is based on Dr Aykroyed formula for Minimum Need Based Wage. This has already been overruled by the Supreme Court as it does not reflect the present day needs for Housing, Social obligations and Children Education etc. The Apex Court had already modified the said formula by adding appropriate weightage for these Factors – which may please be considered for fixing the Minimum Pay and the Pay at higher Levels as well as the Pension as based thereon.

2. PARITY OF PENSION (PARA (10.1.53 & 10.1.67):

a) We welcome the recommendation of 7th CPC and thank the COMMISSION for accepting the long pending demand of Parity between pre and post 7th CPC Retirees. However the method suggested by the Pay Commission for the above purpose, needs to be revised & simplified in view of the following reasons:
i) It may not be possible to implement this Option in many cases for fixation Revised Pension of Pre-2016 Pensioners in the absence of Service Records of the old Pensioners to check the number of increments earned in the Grade from which the Pensioner retired in cases where the Service Records of the old Pensioners are not available thus depriving them of the benefit of the same permanently or for many years till their records are rebuilt – which will be like groping in the dark;
ii) Basing of Pay Matrix & Pension on disproportionate Rise of Pay & Pension – given after 6th CPC – will be unjustified – as the rise given after 6th CPC was 3 times or more in PB 4 as against 2.26 times in PB 2 & PB 3;
iii) Using lower Index of only 2.57 at lower levels and 2.62 at Middle Levels as compared to 2.67, 2.72 and 2.81 at higher Levels of Posts will further accentuate the discrimination caused by the 6th CPC. The Index of 2.81 should be uniformly applied at all Levels.
iv) In the past, while fixing the salary of serving personnel in the revised scale under the 4th CPC recommendations, point to point fixation based on the number of increments already earned was not undertaken and one increment was allowed for every 3 (three) increments earned in the pre-revised scale thereby suppressing the number of increments earned in relation to the number of years actually spent in the grade.
The same principle of allowing one increment for every 3 earned in the 4th CPC scale was also followed while fixing salary of serving employees in 5th CPC scales. This has resulted in artificially suppressing the time spent in a particular level.
v) Senior Pre-2006 Pensioners will get lesser higher pension than even the Pre-2006 junior Pensioners who retired later from the same Post with slightly longer or more years of service in that Grade;
vi) Senior Pre-2016 Pensioners who retired in higher Level of Posts will get lesser pension than the juniors who retired from one or even more Levels below just because Either the Juniors could not get promoted to higher grade but had earned more increments in the lower Grade than the seniors who retired from a higher grade.
Or the two Pay Scale got merged after the retirement of the senior and thus the junior will get the benefit of all increments earned in either of the two scales while the senior will get the benefit of the increments earned only in the higher grade.

All this would be greatly unjustified.

a) It is, therefore, requested to please simplify the method for the purpose and the same should be based only on the information available in the PPO.

b) It is requested that – in order to remove the above infirmities – the Pension of Pre-2016 Civilian Pensioners be fixed at the higher of the following two formulations:
i) a) Pension of Pre 2016 Pensioners be fixed at par with Average of the Pension of Post-2016 Pensioners based on the 50% of the Average Pay in the Pay Matrix or such other formula as may be universally implementable as per readily available records of all concerned / based on the information available in the PPO;
b) Till such time the above said dispensation is implemented, minimum Pension of Pre-2016 Pensioners should not be less than 50% of the minimum of Pay in the Pay Matrix of 7th CPC for the Pay Level corresponding to the Pay Scale or the Grade Pay from which the Pensioner had retired;
ii) Pension fixed after Sixth CPC be multiplied by Multiple Factor of 3.15 if the merger of DA is agreed to or at least to 2.65 if merger of DA is not agreed to (as proposed in Para 3 above)\
iii) Increments earned or the number of years spent in either of the merged scales should be taken into consideration for fixing the Revised Pension.
Pensioners may please be fixed at the higher of the above – without getting any option from the Pensioner as it is an obvious matter that all will opt for the higher Pension.

3. ADDITIONAL PENSION (Para 10.1.28):

7th CPC has totally ignored the reasons of extra expenses on medical care & treatment in old age for the demand for reducing the age for grant of Additional Pension of 5% from 65 years of age, 10% from 70 years and 15% from 75 years. It has also ignored even the recommendations of DOP&PW for starting it at the age of 75 years. This has greatly hurt the Pensioners.

It is, therefore, requested that the Additional Pension may please be granted @ 5% from 65 years of age, 10% from 70 years and 15% from 75 years of age, besides continuing with Additional Pension of 20% from 80 years, 30% from 85 years, 40% from 90 years, 50% from 95 years and 100 % from 100 years of age as granted after 6th CPC.

4. FIXED MEDICAL ALLOWANCE(Ref: Para 8.17.52):

It is regretted that the 7th CPC has recommended no enhancement of Fixed Medical Allowance (FMA) for Pensioners for day- to-day medical treatment not requiring hospitalization, merely on the ground that “this Allowance was last enhanced from Rs.300 to Rs.500 pm from 19/11/2014” – even without going into the merits of the following valid reasons advanced for the revision thereof:
i) FMA should have been revised from 1-9-2008 – like all other Allowances after the 6th CPC. The belated revision done in 2014 was itself delayed by 6 years;
ii) The cost had exorbitantly increased for the Medicines, Consultation Fee and cost of Pathological Tests required for day-to-day medical treatment since 1999 (when the FMA was initially granted) and this had risen at a much steeper rate than the Price Index.
iii) Average expenditure per pensioner/per Patient on OPD in CGHS Hospitals has increased manifold and is at present over Rs.2500 per patient. This reflects the exorbitant increase in the cost of Medicines, Consultation Fee and cost of Pathological Tests etc. required for day-to-day medical treatment. The FMA of Rs.500 per month is thus a pittance of the actual expenditure on day-to-day Medical Treatment by the Pensioners who are residing in non-CGHS /RELHS areas and have thus opted out of the same.
iv) A large proportion of Pensioners were residing in remote areas or villages having no excess to CGHS Dispensaries & Railway Hospitals and as such, are wholly dependent on the paltry amount of FMA for day-to-day treatment of self & spouse.
v) It is, therefore, requested that the FMA may please be revised to at least Rs.2000 p.m. or at par with the average expenditure on OPD Treatment per month per Pensioner / Patient.
Hoping for a favorable consideration;
Thanking you
Yours faithfully
(Harchandan Singh)
Secretary General, RSCWS
Source: IRTSA
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Extension of Deputation Tenure up to 7 Years

Delegation of powers to Ministries / Departments / Borrowing Organisations to extend deputation tenure upto 7 years in cases of Deputations. No extension of deputation beyond 7 years is to be allowed unless provided in the relevant Recruitment Rules of such deputation post.

deputation-tenure-7years


Extension of Deputation Tenure up to seven years

Delegation of powers to Ministries / Departments/Borrowing Organisations to extend deputation tenure upto 7 years in cases of Deputations covered by DoP&T’s OM No. 6/8/2009-Estt(Pay-11) dated 17th June 2010

DoPT OM on Delegation of powers to Ministries / Departments/ Borrowing Organisations to extend deputation tenure upto 7 years in cases of Deputations covered by DoP&T’s OM No. 6/8/2009-Estt(Pay-11) dated 17th June 2010.

F.No. 2/6/2016-Estt. (Pay-II)
Government of India
Ministry of Personnel, Public Grievances and Pensions
Department of Personnel and Training
North Block, New Delhi
dated 17th February, 2016
OFFICE MEMORANDUM

Subject: Delegation of powers to Ministries / Departments/Borrowing Organisations to extend deputation tenure upto 7 years in cases of Deputations covered by DoP&T’s OM No. 6/8/2009-Estt(Pay-11) dated 17th June 2010 – regarding.

This Department’s OM No. 6/8/2009-Estt.(Pay-II) dated 17th June 2010 regulates Pay, Deputation (Duty) Allowance, Tenure of Deputation / Foreign Service and other terms and conditions on the subject of deputation / foreign service of Central Government employees to ex-cadre posts under the Central Government, State Governments, Public Sector Undertakings, Autonomous Bodies, Universities/ Union Territories Administration, Local Bodies etc. and vice-versa (copy enclosed). Subject to its applicability as provided in para 2 of the OM, these instructions cover cases of deputation/ foreign service where Central Government is either lending authority or borrowing authority or both. It provides for duration of maximum Deputation Tenure as 5 years at a stretch. As per para 8.3.1 (iii) of this OM, no further extension beyond the fifth year shall be considered.

2. Various administrative Ministries/ Departments/ Borrowing Organisations have been approaching this Department for relaxation of the 5 year deputation tenure condition, on case to case basis, citing exigencies, quoting provisions of para 10 of the OM dated 17.6.2010 ibid.

3. It has been decided that if the administrative Ministries / Departments and other borrowing organizations wish to retain an officer beyond 5 years, they may extend tenure of deputation covered by OM No. 6/8/2009-Estt.(Pay-II) dated 17th June 2010, where absolutely necessary in public interest, upto a period not exceeding 7 years at a stretch. This shall be done with the approval of the Minister of the borrowing Ministry / Department concerned and in respect of other organizations with the approval of the Minister of the borrowing Ministry/Department with which they are administratively concerned, keeping in view the exigencies and subject to fulfillment of all other requirements such as willingness and vigilance clearance of the Officer concerned, NOC of the lending authority, UPSC / ACC approval wherever applicable. Thus, no case of extension shall be referred to Department of Personnel & Training, New Delhi.

4. All other terms and conditions issued vide OM No. 6/8/2009-Estt.(Pay-II) dated 17th June 2010 will remain unchanged.

5. In cases where the necessity to have deputation tenures longer than seven years is felt, the concerned administrative Ministries / Departments/ borrowing organisations may amend the relevant Recruitment Rules of such deputation post accordingly, after following the requisite procedure. No extension of deputation beyond 7 years is to be allowed unless provided in the relevant Recruitment Rules of such deputation post. It is reiterated that no case for extension beyond five years shall be referred to DoPT.

6. It is also clarified that cases which are not covered by the OM dated 17.6.2010 including those where Central Government is neither lending authority nor borrowing authority, will continue to be decided in terms of the relevant provisions/ rules/ instructions etc. governing them.

7. These orders shall come into effect from the date of issue of this OM.
(Ashok Kumar Jain)
Deputy Secretary (Pay)
Download DoPT OM F.No. 2/6/2016-Estt. (Pay-II) dated 17.02.2016
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Promotion of Under Secretaries of CSS to DS grade on ad-hoc basis – Furnishing of personal information thereof

Promotion of Under Secretaries of CSS to DS grade on ad-hoc basis – Furnishing of personal information thereof
No.4/11/2015-CS~I(D)
Government of India
Ministry of Personnel, Public Grievances and Pensions
(Department of Personnel & Training)
Lok Nayak Shawan, New Delhi -110003
Dated the 22nd February, 2018

Subject: Promotion of Grade-I (Under Secretary) officers of CSS to the Selection Grade (Deputy Secretary) on ad-hoc basis – Furnishing of personal information thereof.

The undersigned is directed to say that promotions of officers of Grade-I (Under Secretary) of CSS to the Selection Grade (Deputy Secretary) on ad-hoc basis are likely to be made shortly.

2. The officers who are to be considered for promotion/posting is at Annexure-I. Details of vacancies in DS/Director grade of CSS is at Annexure-II.

3. The officers may exercise their choices as per RTP latest by 23.02.2016 in the format at Annexure-III. The options should be furnished to Under Secretary, CS-I (D), Department of Personnel and Training through e-mail (uscsoned@gmail.com ). If option is not received from the officers who are in the cadre by 23.02.2016, it will be presumed that the officer concerned has no specific choice and posting will be decided by the Placement Committee accordingly. In case the officers who are on depuation do not furnish their choices by the stipulated time, it will be presumed that they are not willing to repatriate to the cadre to avail ad-hoc promotion and their names will be considered in future only on receipt of written communication conveying their willingness to repatriate to the cadre to avail promotion.

4. The officers before submission of options should ensure that data in their respect is complete and update in the web based cadre management system (cscms.nic.in). If the data is not complete it should be first got updated before submission of option.
(V.Srinivasaragavan)
Under Secretary to the Government of India
Telefax: 24829413
To
1. Officers listed at Annex.1

Click to read more
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7th Pay Commission implementation may force Railways to hike Rail Fares – 5% to 10% increase in passenger fare expected

7th Pay Commission implementation may force Railways to hike Rail Fares – 5% to 10% increase in passenger fare expected

Railways have conducted a study by Axis Capital which has recommended a 10 per cent hike in passenger fares and a 5 per cent raise in freight rates to improve the state-run transporter’s finances.

Facing resource crunch, Indian Railways is said to be mulling the possibility of effecting a 5 to 10 per cent increase in the passenger fares in the coming budget to be presented by Suresh Prabhu on 25th February, while FM Arun Jaitley will present the Union Budget on 29th February, 2016. The proposal is being considered against the backdrop of a decline in both passenger and freight earnings and the additional burden of Rs 32,000 cr towards implementing the 7th Pay Commission recommendations, Railway Ministry sources said.

On top of the 7th Pay Commission burden this, the gross budgetary support for the 2015-16 has also been slashed by Rs 8,000 cr by the Finance Ministry due to low spending by the Indian Railways. The sources said there are several possibilities including a fare hike are being looked into nothing has been finalised yet.

The sources said a decision has to be taken whether to hike the fares and, if so, when. But it is not necessary it has to be done only in the budget, they said. There is a feeling in Rail Bhawan that a fare hike in budget 2016 to be presented on Feb 25 can be more beneficial as the railways can utilise the peak season beginning March.

Currently AC fares are already on higher side. If AC fares are raise, then they could even surpass the fares of low-cost air carriers in some sectors. Similarly, freight rates are also at a high level and loading of steel, cement, coal, iron ore and fertiliser is on a down slide that rules out any further increase in this area.

Indian Railways had effected a 14 per cent across-the-board hike in passenger fares in 2014 during the NDA regime and a 10 per cent increase last year. Railways’ total earnings from freight and passenger fares were Rs 1,36,079.26 cr until January this year as against the target of Rs 141,416.05 cr, a shortfall of 3.77 per cent.

Acknowledging the decline in earnings sources said various options were being explored to perk up revenue collections. While one option is to raise the fares in selected routes, the other is to go for increasing the cost of services provided. (Reuters)

Meanwhile railways have undertaken steps for cutting the costs and for commercial exploitation of surplus railway land besides looking at higher revenues from advertisement in a bid to tide over the crisis. The focus may be on improving non-tariff collection, the sources said. Railways have conducted a study by Axis Capital which has recommended a 10 per cent hike in passenger fares and a 5 per cent raise in freight rates to improve the state-run transporter’s finances.

Source: The Financial Express
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7th Pay Commission Latest News – Implementation could affect Capital Spending

7th Pay Commission Latest News – Implementation could affect Capital Spending

Economists predicts that spending pressures out of additional Salary expenditures out of 7th Pay Commission implementation, increase in food subsidies, Crop Insurance Scheme etc
7th Pay Commission Latest News – Cost of 7th CPC implementation could affect Capital Spending needed for Railways, Roads, Ports and Power Projects
A $16 billion (Rs 1.1 lakh crore) pay rise for government employees and costly food and farm programmes could force Finance Minister Arun Jaitley to cut capital spending in its annual budget, officials and economists say.

The spending pressure on Jaitley threatens to worsen imbalances in India’s $2 trillion economy as consumption outpaces investment.

A populist budget, ahead of assembly elections in four states this year, could stoke inflation even as structural measures such as Prime Minister Narendra Modi’s proposed tax and labour reforms look less likely.

It could also eat into capital spending needed for railways, roads, ports and power projects, seen as vital to India’s integration into the global economy.

“It is not going to be a revolutionary or inspirational (budget) … given the spending pressures,” said Shilan Shah at Capital Economics. “It is most likely to lead to a sell-off in the bond market if the salary increase is implemented.”

Jaitley presents his third budget on February 29 and is expected to implement the recommendations of a government commission to raise pay for 1 crore government workers and pensioners by 23.5 percent.

While that hike would boost demand, economists question whether a policy dating back to an era of double-digit inflation is justified today, when Reserve Bank of India Governor Raghuram Rajan has driven consumer price growth below 6 percent.

Officials with direct knowledge of budget discussions said Jaitley could raise taxes on services and petroleum products to help cover the extra outlays.

He would still have some room to ease tax rules on foreign investment and hit his deficit target of 3.5 per cent of gross domestic product in the 2016/17 fiscal year.


COSTLY PROMISES

The promised pay hike, an increase in food subsidies and a new crop insurance scheme for farmers would cost at least Rs 1.2 lakh crore ($17.5 billion) – equivalent to 0.9 per cent of forecast GDP in 2015/16.

India’s cash-strapped state railways, which employ 13 lakh, are also seeking central funds to cover higher pay – squeezing its investment budget and creating pressure to hike fares. Most of India’s 29 states will raise wages soon.

Rajan, who cut policy rates by 125 basis points in 2015, has said the pay commission award, if implemented, could lead to higher inflation for one to two years.

Much depends on the timing of the government pay rises, which sources say could take retroactive effect on January 1, 2016. Economists and ratings agencies say the fiscal deficit target may have to be raised to 3.8 per cent of GDP to cover the hike.


LOSING PATIENCE


Analysts say the country’s finances and economic performance, a rare bright spot for emerging markets over the past two years, are now under close investor scrutiny.

Foreign investors have been net sellers of Indian stocks and bonds this year, erasing all of the gains in the Sensex since Modi’s landslide general election victory in May 2014.

Despite the windfall of low oil prices, half of which was clawed back through higher energy taxes, India’s consolidated fiscal deficit exceeds 6 percent of GDP and the national debt, at 68 percent, is high by emerging market standards.

And although growth is forecast at 7.6 percent in the current fiscal year, India’s banks are hobbled by growing bad debts and do not have the means to fund new growth projects.

Source: Fist Post
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