Thursday, 10 September 2015

7th Pay Commissions report to be implemented ahead of states elections in May

Seventh Pay Commissions report to be implemented ahead of states elections in May

New Delhi: Ahead of the states’ assembly elections in May’ 2016, the Central government may implement the recommendations of the Seventh Pay Commission after receiving the report of the pay panel within this year, which will benefit 50 lakh central government employees and 56 lakh pensioners including dependents.

“The central government will decide execution time of the pay commission’s proposals after the pay panel submits its report, which will be possible pre-election “special packages” for West Bengal, Assam, Kerala and Tamil Nadu, which are all due for polls by May 2016,” an official of the Finance Ministry said, speaking on condition of anonymity.

Just like one rank one pension (OROP) was announced by Modi government on 5th of this month ahead of Bihar Assembly election despite huge financial burden to get majority seats of his party in Bihar Assembly.

OROP announcement not only is pre-election BJP’s special package but also Union cabinet approved six percent increase in DA for central government employees on Wednesday, making the total to 119 percent, on a day the Election Commission announced poll dates for Bihar is a move that would benefit the BJP in Bihar Assembly Election.

Accordingly, JD (U) leader K C Tyagi said, “The Modi government gave a ‘political bribe’ to voters. I welcome the DA hike for central government employees, but, I feel the, timing of the announcement is not correct.”

BJP needs to win most state elections in the next four years to gain control of the Rajya Sabha, where seats are distributed based on the strength of parties in state assemblies.

A defeat for Prime Minister Narendra Modi would harm his chances of consolidating power in parliament, where his reform agenda is being blocked because his party is in the minority in the Rajya Sabha.

So, Modi led BJP government is ready to give any sop to win states assemblies electons.

Finance Minister Arun Jaitley said on August 30, that report of Seventh Pay Commission for central government employees was coming shortly.

However, Chairman of the Seventh Pay Commission, Justice Ashok Kumar Mathur told PTI on August 25, “The Commission will submit its report by the end of September.”

Now, it is expected that recommendations of Seventh Pay Commission, will be implemented before the announcement of West Bengal, Assam, Kerala and Tamil Nadu states assemblies’ election in May 2016.

The Seventh Pay Commission, which was set up by the UPA government, was required to submit its report by August-end.The government constitutes the Pay Commission almost every 10 years to revise the pay scale of its employees and often these are adopted by states after some modifications.

The Commission has already completed discussions with various stakeholders, including organisations, federations, groups representing civil employees as well as Defence services and is in the process of finalising its recommendations.

The recommendations of the Seventh Pay Commission are scheduled to come into effect from January 1, 2016.

The Sixth Pay Commission was implemented with effect from January 1, 2006, the fifth from January 1, 1996 and the fourth from January 1, 1986.


6% DA hike from July 2015 – Central Cabinet approved yesterday

6% DA hike from July 2015 – Central Cabinet approved yesterday

“The central cabinet has given its approval yesterday to a six percent hike in dearness allowance from July 2015 onwards, for Central Government employees and pensioners.”

Central Government employees and pensioners get two dearness allowance hikes each year. The dearness allowance for the period of months between January to June is given in March; the DA hike for July to December is given in September.

Accordingly, the second installment of Dearness Allowance, for the months of July to December, has been fixed at 6 percent. The cabinet gave its approval yesterday. The current DA of 113% will, from 01.07.2015 onwards, increase to 119%.

Following the hike, Central Government employees will get a minimum increment of Rs.420 per month. The increase is dependent on the basic pay(Band Pay + Grade Pay) of the employees. For example, let us consider an employee who has been working for 25 years, and receives a basic pay of Rs.16,000 per month. He will get a DA hike of Rs.960.

The current method of calculation of DA was prescribed by the 6th Pay Commission. The method, which has been in effect for nearly ten years now, will be used one last installment to calculate the DA of January (01.01.2016). The subsequent Dearness Allowance calculations will be made based on the method recommended by the 7th Pay Commission. The Commission is expected to submit its recommendations to the Centre by December this year. The recommended revised method of calculations for DA in the report will be follow to arrive DA from 1.1.2016.

Towards the end of this month, the Ministry of Finance will issue relevant orders to give out six percent DA payment to the Central Government employees and pensioners. Only then will the increased DA be given to the employees, along with the arrears of the past two months (July and August).

78 cities were selected from all over the country and the fluctuations in the prices of essential commodities in these cities are tracked. These fluctuations are used to calculate the monthly points (CPI-IW BY 2001 = 100), which are further used to arrive at the dearness allowance.

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