7th Pay panel formed, retirement age may go up 62 yrs – Moneycontrol
The award of the seventh pay commission will be implemented from the beginning of 2016 and will benefit nearly 3 million pensioners. But since state governments generally match central wages, the actual beneficiary list stands at over 11 million employees and pensioners.
Siddharth Zarabi
The national capital, home to a vast majority of central government employees, is headed for elections this November. And so are four other states, followed by the general elections sometime early next year. This, more than anything else, explains the central government’s hurry to promise its employees higher wages.
The award of the seventh pay commission will be implemented from the beginning of 2016 and will benefit nearly 3 million pensioners. But since state governments generally match central wages, the actual beneficiary list stands at over 11 million employees and pensioners. The fact that this award is one more in a long list of expenditure-heavy pre-election programmes, will mean several consequences for India’s finances. Back of envelope calculations suggest that even if the increments in the 6th pay commission were to be matched, the centre’s wage bill could rise by up to Rs 1 lakh crore in 2016. But on the other hand, this payout will spark a surge in consumption starting that year. Why? The sixth pay commission award amounted to around 0.5 percent of GDP and a tidy sum was handed out as arrears in the start of 2008. That extra spending power meant that the ensuing slowdown was mitigated to some extent. This could play out again in 2016. Meanwhile, CNBC TV18 learns that the proposal to extend the retirement age of central government employees by two years has received fresh impetus. A decision on this could be taken within a week or two, and would be the second major populist decision by the UPA to woo the urban middle class and the powerful government employee mass in Indian society.
Source: www.moneycontrol.com
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Ibn Kumar says
Attention UPA Govt!!
It is hard but the truth is the next government would be BJP, who is never against hiking retirement age. There are record number of employees, who are on verge to retire in the next 2 years. Considering the fact that the last retirement age which was enhanced from 58 to 60 was done by BJP Government and the UPA has created negativity among the employees as they were many rumours about the increase in retirement age to 62. Now in present situation the employees are very dissappointed and wants to hike the retirement age to 62.
So the best option for the UPA Government is to raise the retirement age and consider the vote bank of the to-be-retired employees and you may come into power.
Unless this, It is practically impossible for UPA to survive as there is lot of negativity among Central Govt Employees. And as far youth is concerned it would not impact them as just 4% of Indian job market has central government jobs!!
And it is already proven that just 30% of youth only would caste their vote and various surveys reveal that they are seeking for change in Government.
So the final verdict is, Raise the Retirement age to 62 and capture the vote bank, if you UPA wants to come into power in 2014!!