Monday, 30 January 2017

Revision of NPS, Minimum Wage, Fitment Formula, Allowances and Pension - GS COC Karnataka


Revision of NPS, Minimum Wage, Fitment Formula, Allowances and Pension - GS COC Karnataka

"The Staff Side (JCM) had demanded the fitment formula of 3.72 that is Rs 26000/ Rs 7000 as on 1st Jan 2014. Whatever angle we look the 7th CPC has cheated us on the minimum wage and fitment formula compared to the earlier pay commission this pay commission has given us the lowest wage hike of just 14% compared to last 40 years."

16th March Strike Importance

Dear Comrades,
The main demands of the Staff Side (JCM) which led to declaration of the 11th July strike is the revision of the NPS, minimum wage, fitment formula, allowances and pension cases etc. this is due to lowest wage hike of just 14% recommended by the 7th CPC.

Under the 7th Pay Commission slab - which was implemented ten years after the previous pay commission the salaries of the government employees saw a marginal rise of just 14% . The basic pay under the 7th CPC the minimum wage was increased to Rs 18,000 from Rs 7,000 (2.57 times) while the salary of the senior government officials has gone up to Rs 2.50 lakh from Rs 90,000(2.77 times).

The minimum wage was increased by 2.57 times but in actual terms this increase is of just Rs 2250/- in 7th CPC, while taking into account of 125% DA was merged this due to rising inflation and price rise already the CG employees wage factor was 2.25 time, that is basic of Rs 7000/- plus DA of 125% of Rs 8750 works out to Rs 15750/- , staff side had already demanded for a hike of more than three times which is Rs 26,000 per month.

Comparison of earlier wage hike we can observe that the fitment factor of 2.57 times is the lowest comparing to other pay commissions. If we make a study of earlier pay commission.

Pay CommissionYearMinimum wage oldMinimum wage revisedIncrease
2nd CPC1959Rs 55/-Rs 80/-1.45 times
3rd CPC1973Rs 80/-Rs 196/-2.45 times
4th CPC1986Rs 196/-Rs 750/-3.82 times
5th CPC1996Rs 750/-Rs 2550/-3.40 times
6th CPC*2006Rs 2550/-Rs 7000/-2.74 times
7th CPC *2016Rs 7000/-Rs 18000/-2.57 times

" The minimum qualification required at lower level appointments from the year 2008 has been revised from 8th pass to 10th pass (SSLC) as per the 6th CPC recommendations, hence the minimum wage should increase by 25% compared to earlier pay commissions.

The minimum wage has increased considerably due to price inflation from 4th CPC (1986) onwards the average wage hike is 3.32 times. During the period 1946 to 1972, the financial position of the Central Government was not that good. The financial position of the Central Government has been improving from the 4th CPC onwards that is from 1986 onwards, the pay fixation depends on the paying capacity of the Central Government. The revenue collection of the Central Government has increased especially from last few years. The revenue expenditure in respect of salaries of Central Government employees is just under 10% of the Central Government revenue. In respect of the many State Governments the revenue expenditure towards salaries is around 20%. Whereas the Central Government is spending just 10% of the revenue collection on salary head.

The wages of CG employees are determined based Dr. Aykroyd formula, the Staff Side (JCM) has calculated minimum wage as on 1st Jan 2014 as per the Dr. Aykroyd formula as Rs 26,000/- taking into market prices. Even if we adopt the retail prices of The Directorate of Economics & Statistics Department of Agriculture & Cooperation Ministry of Agriculture Government Of India New Delhi of the month of July 2016 the minimum wage works out to Rs 24,000/ which is 3.42 times increase. The 7th CPC has also adopted Dr. Aykroyd formula for the computation of the minimum wage and fixed at Rs 18000/- and thereafter the fitment formula is calculated.

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