Higher Allowances for central staff likely from 1st April

7th Pay Commission: Govt not to hike minimum pay, higher allowances to be paid from April 1.

No Arrears likely.

 In a setback to central government employees, Centre has decided not to hike minimum pay under the 7th Pay Commission recommendations. Higher allowances and minimum pay under the 7th Pay Commission have been the major bone of contention among majority of the central government employees. The government seems in no mood to increase minimum pay of Rs 18,000 under the 7th Pay Commission. Though the government is expected to announce higher allowances in March, it had no plan to give allowances in arrears from August.

The government has fixed the minimum pay at a meagre Rs 18,000 in the 7th Pay Commission. In the 6th Pay Commission, the basic pay was Rs 7,000. The government multiplied it by 2.57 (fitment formula) and came to Rs 18,000. But the central government employees unions are demanding to hike minimum pay to Rs 26,000 by 3.68 fitment formula.

The government had assured central government employees unions that their demands would be considered and promised to form High Level Committee to examine the 7th Pay Commission recommendations in respect of minimum pay. The government then took a U-turn and decided not to appoint the High Level Committee. It shows the government is no mood to raise the minimum pay under the 7th Pay Commission.

“The government will not clear any proposal on hike in minimum Pay including others pay related matter under the 7th Pay Commission recommendations because the cabinet had already passed it. Hence cabinet only will take higher allowances which was not given nod by it”, the Finance Ministry sources were quoted as saying by Sen Times.

When it comes to higher allowances, the government is hopeful for the announcement of higher allowances in March after the completion of five states assemblies’ elections. The government is planning to pay higher allowances under the 7th Pay Commission from April 1, but it is unlikely to make any announcement about arrears. “There’s no arrears on allowances will be given to employees,” said the Finance Ministry sources.

The 7th Pay Commission had recommended abolition of 51 allowances and subsuming 37 others out of 196 allowances. To examine the hike in allowances other than dearness allowance, the government referred the matter to the ‘Committee on Allowances’ headed by the Finance Secretary Ashok Lavasa. The report of ‘Committee on Allowances’ is ready, but the government gave extension the committee till February 22, 2017 to submit its report.