New Delhi: The Committee on Allowances will propose to increase allowances of central government employees, besides dearness allowance (DA) in this month.

DA is being paid to them with their pay packages.

The Committee on Allowances, under Finance Secretary Ashok Lavasa, was formed in July 2016 following protests by government employees over recommendations of the 7th Pay Commission on allowances.

The 7th Pay Commission had recommended of abolishing 51 allowances and subsuming 37 others out of 196 allowances.

The committee was initially given four months time to submit the report to Finance Minister Arun Jaitley.

Later, the Finance Minister extended the deadline for report submission to February 22, 2017.

The Committee on Allowances is yet to submit its report, the Minister of State for Finance Arjun Ram Meghwal said in Lok Sabha on March 10.

However, he said that the deliberations of the committee are in the final stages.

Besides the basic salary, a large portion of a central government employee’s salary is the house rent allowance (HRA); some changes are to be made in this category of the recommendations of the 7th Pay Commission on allowances,

“The Committee on Allowances has decided against reducing the house rent allowance (HRA). The 7th Pay Commission suggested bringing down the HRA to 24 per cent, 16 per cent and 8 per cent respectively depending on type of cities,” the Finance Ministry’s officials said.

The officials also said that the Committee on Allowances would suggest, the HRA is to be kept as it was under the Sixth Pay Commission at 30 per cent, 20 per cent, and 10 per cent respectively.

The Committee on Allowances is likely to remain constant the Transport Allowance for central government employees as 6th Pay Commission recommendations including Dearness Allowance(DA), the sources added.

So, the employees now get all allowances except dearness allowance, according to the 6th Pay Commission recommendations until issuing of higher allowances notification.

The higher allowances most probably to implement from the month of April and the cabinet may give its nod in this month, the sources confirmed.

TST

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Seventh Pay Commission is ready with its recommendations and it will soon submit its report to Finance Ministry. The recommendations are to be implemented from January 1, 2016.

The Central Government employees must be curious to know what all are in the store for them in the seventh pay commission’s recommendations.

Seventh Pay Commission

• It was formed by previous UPA Government. The commission, headed by Justice A K Mathur was formed in February 2014.
• The other members of the commission are Vivek Rae, a retired IAS officer of 1978
• batch, and Rathin Roy, an economist. Meena Agarwal is  Secretary of the Commission.
• The  committee’s recommendations are scheduled to take effect from 1 January, 2016.
•  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.
• Nearly 48 lakh central government employees and 55 lakh pensioners will be befitted by the pay commission.

 Salary Increment:

•  Reportedly, there could be a substantial increment in the current salary of the employees (around 30-40 per cent).
• It has been proposed that the salary of the Government employees should be increased every year on July 1.

Major Recommendations

• According to Dainik Bhaskar exclusive report, IPS, IAS and IRS rank officers’ pay band will be made equal. Currently IPS, IRS officers get less salary than IAS.
• It has been proposed that existing 32 pay-bands should be decreased to 13.
• For Pay band-1, the minimum salary will be 21, 200.
•  The Cabinet secretary will get minimum 2 lakh salary.
•  There could be an education allowance to employees whose offspring are in the school.
• In last pay commission (6th), the minimum basic salary was increased to Rs 6660 from Rs 2550.
•   Experts are having views that employees of lower rank will be benefited the most from the seventh pay commission.

   Financial Burden:

•  Seventh pay commission will definitely bring a toll on the exchequer.
• The reason being Government has to manage OROP’s expenditures too.
•  Experts say that Central government’s salary bill will rise by 9.56% to Rs 1,00,619 crore after Seventh pay commission will come into effect.
•  According to Mint report, as a result of the recommendations of the Sixth Pay Commission, pay and allowances of Union government employees became more than doubled between 2007-08 and 2011-1-from Rs.74,647 crore to Rs.166,792 crore.

   Past pay commissions and the minimum basic salary:

•  First pay commission came in year 1946 and the basic salary at that time was decided to be of Rs. 35.
•  Second pay commission came in year 1959 and basic salary was of Rs. 80.
•  In 1973, third pay commission came into effect which decided the basic salary of Rs. 185.
•  Fourth pay commission came in year 1986 which recommend basic salary of Rs. 750.
•  In year 1996, fifth pay commission came, recommending basic salary of Rs. 2550.
•  Sixth pay commission came into effect in year 2006. UPA Government at that time, fixed minimum basic salary of Rs. 6660.

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