No.1/1(5)/2018-P&PW(E)
Department of Pension & Pensionors’ Welfare
(Desk E)

Sub: Clarification on date upto which enhanced family pension payable-reg.

Ref: CPAO ID No. CPAO/IT & Tech/Clarification/13(VOL-III)/P&PW/2017-18/193 dated 05.02.2018 and NIC Note, dated 3.4.2013.

CPAO may please refer to above mention ID, dated 5.2.2018 on the subject mentioned above.

2. It was decided to increase the age of retirement from 58 to 60 years vide its notification No.25012/2/97-Estt.(A) dated 13th May, 1998. In pursuance of this decision and in view of the recommendation of the Vth Central Pay Commission, in partial modification of Rule 54(3) (a) of CCS (Pension) rules, 1972, it was decided that the payment of family pension at enhanced rates will be payable for 7 years or till the government servant/pensioner would have attained the age of 67 years against the existing provision of 65 years. This has been applicable in cases where Government servant is to retire at the age of 60 years in pursuance of the notification dated 11.05.1998 and not where Government servant has already retired at the age of 58 years or would have retired at the age of 55 years but for his premature demise.

3. Subsequently rule 54(3)(a)(ii) has also been amended to read as under:
In the event of death of Government servant after retirement, the family pension as determined under sub-clause (i) shall be payable for a period of seven years, or for u period up to the date on which the retired deceased Government servant would have attained the age of 67 years had he survived, whichever is less.

4. In view of this it is clear that family pension at enhanced rates will be payable for 7 years or till the deceased retired government servant would have attained the age of 67 years had he survived, whichever is less, irrespective of type of retirement. date of retirement and age of superannuation applicable in the case of retired Govt. servant. This would equally apply in all Central Civil Govt. Departments/Offices including CPAF and Medical Officers.

5. This issues with the approval of competent authority.

sd/-
(Sanjoy Shankar)
Under Secretary

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QUANTIFICATION OF NEED-BASED MINIMUM WAGE AND NEED FOR REVISION OF MINIMUM WAGE OF CENTRAL GOVERNMENT EMPLOYEES

The concept of the Need-Based Minimum Wage has evolved in India after Independence and owes its origin to the Directive Principles of the Indian Constitution and the welfare policy of the Government. Its acceptance in principle connotes a public effort at an institutional determination of wage rates particularly in the industrial sector of the economy. Unfortunately the computation of the need based minimum wage has become a controversial subject in the country. While the concept of what the need based minimum wage should cover is fairly clear and generally accepted by both the employer and employee, its actual assessment into monetary terms has raised endless disputes not alone by the employer.

NEED-BASED MINIMUM WAGE FORMULA:

Minimum wages for the average family will have to be based on requirements of food, clothing, housing and so on. Additional components of expenditure to cover for children’s education, medical treatment, recreation, festivals and ceremonies.

In a vast country such as ours, there are bound to be regional variations in these requirements owing to climatic conditions, food habits, etc. At the same time in order to ensure a degree of uniformity the Conference have adopted a certain norms. The food component carries the largest- proportion of the total cost of living in a working class family. The component’s significance is not only economic but human also. On food depends the health and efficiency of the worker, which is vital to the industrial production. After a protracted discussion the Conference adopted Dr. Aykroyd’s second dietary prescription of the adequate diet level, the other one being the optimum diet level. An optimum diet according to him, is one which ensures the functioning of the various life processes at their very best; whereas an adequate diet maintains these processes but not at their peak levels. The optimum diet would include more of vitamins and less of proteins in its caloric content, while the adequate diet would include more of proteins and less of vitamins.

The Committee on Fair Wages laid down that the standard working class family should be reckoned as one consisting of three consumption units, supported by a single male earner and including his wife and two children below the of age 14 The 15th Session of Indian Labour Conference approved that the wage should cover four categories of needs considered essential for the worker’s well being, viz. food, clothing, housing and miscellaneous. In calculating the minimum wage, the norms for the food category should be based on Dr. W.B. Aykroyd’s formula for an adequate and balanced diet. It thus came about that a wage linked to the needs was suggested as a desirable minimum.

Subsequently, when attempting to implement the recommendations of the conference, almost all the wage fixing authorities including the committees appointed under the Minimum Wages Act, 1948 have invariably faced difficulty in determining: (i) the calorific norm which should form the basis of the diet content (ii) the exact composition of the diet (iii) the qualities of the various items of diet and (iv) availabilities of food commodities consumed by the worker and his pattern of consumption. In this regard the first assault was launched by the II Central Pay Commission (1959), pertaining to the calorific norm as laid down by the 15th Indian Labour Conference. The Indian Labour Conference worked out the three-unit formula, the minimum wage is worked out taking into consideration the calorific value requirements of 2,700 each, certain length of cloth requirement, housing rental value, education and medical expenses etc.

CONCEPT OF LIVING WAGES:

Concept of Living Wages It represents a standard of living which provides not merely for bare physical subsistence but for maintenance of health and decency, a measure of frugal comfort, including education of children, requirement of essential social needs and a measure of insurance against eh more important misfortunes including old age. This is the ideal wages and envisaged in Article 43 of Directive Principles in Part IV of the Constitution. I. L. O. Conventions also provide for living wages.

Living wages is the ideal wages and on the line as stipulated in Article 43 of our Constitution. Wage differentials are necessary part of wage structure if skill formation is to be motivated and productivity is to be achieved but at the same time it should be reasonable.

Hence it is relevant to quote the following observation made by the Kerala High Court in Association of Planters of Kerala v State of Kerala in this regard:  A failure to fix or revise minimum wages was not only a statutory violation but is a breach of fundamental right enshrined in Art. 23 of the Constitution. A duty is cast upon the State by provisions of the Act and Article 23 to fix and revise the minimum rates of wages.

7th CPC REPORT PARA NO 4 HAS ALSO DEALT THE ISSUE OF A NEED-BASED MINIMUM WAGE TAKING INTO THE CONCEPT OF THE FOLLOWING.

a) Normative family is taken to consist of a spouse and two children below the age of 14. With the husband assigned 1 unit, wife, 0.8 unit and two children, 0.6 units each, the minimum wage needs to address 3 consumption units;

b) The food requirement per consumption unit is shown in the Annexure to this chapter. The specifications were derived from the recommendations of

Dr. Wallace Aykroyd, the noted nutritionist, which stated that an average Indian adult engaged in moderate activity should, on a daily basis, consume 2,700 calories comprising 65 grams of protein and around 45-60 grams of fat. Dr Aykroyd had further pointed out that animal proteins, such as milk, eggs, fish, liver and meat, are biologically more efficient than vegetable proteins and suggested that they should form at least one-fifth of the total protein intake

c) The clothing requirements should be based on per capita consumption of 18 yards per annum, which gives 72 yards per annum (5.5 meters per month) for the average worker’s family. The 15th ILC also specified the associated consumption of detergents

d) The prescribed provision of Report of the Seventh CPC 63Index 25 percent to cover education, recreation, ceremonies, festivals and medical expenses has been reduced to 15 percent.

THE THREE-UNIT BASED FORMULA ADOPTED BY THE PAY COMMISSIONS NEEDS A CHANGE TO SIX UNITS DUE TO FOLLOWING FACTORS :

The three-unit based formula to fix minimum wages presently counts only four members of a family ie husband, wife and two children. It has no provision to count dependent parents, if any, or even if there are more than two children.

The three-unit formula gives the husband a full unit, wife 0.8 unit, and 0.6 units for each of the two children.

Now the trade unions and the employees associations are of the opinion that the three-unit system are not sufficient to decide minimum wages because the children continue to stay with the family for longer periods. The two children and wife should be accorded one single unit instead of 0.6 units,” also, marriageable age of a child has also increased and they should also be given full units, the gender equality should also be observed instead of 0.8 units it should be full unit for the spouse.

Hence should be revised to the four unit formula gives the husband a full unit, wife full unit, and full units for each of the two children.

After the 2010 Supreme Court ruling that dependent parents are to be taken care of by children, two more units should be added and the formula be based on six-unit formulae than three.

“The CrPC section 125 and Maintenance of Parents and Senior Citizens Act make it mandatory for an earning member to maintain his parents, failing which he/she may have to face penal consequences. Today, the average life span of a person has increased to 68.3 years compared to that of 41 years in 1957. Hence two additional units have to be added,”

So there is a need to hike number of units from three to six to calculate minimum wages.

OTHER FACTORS AFFECTING OUR WAGES ARE AS FOLLOWS:

1) The 7th CPC has taken into consideration the 15% to cover education, recreation, ceremonies, festivals and medical expenses against 25% prescribed by the Supreme Court. Additional components of expenditure to cover for children’s education, medical treatment, recreation, festivals and ceremonies. This followed from the Supreme Court’s ruling in the Raptakos Brett Vs Workmencase of 1991 for determination of minimum wage of an industrial worker. The Supreme Court had prescribed this amount at 25 percent of the total minimum wage calculated from the first five components.

2) Secondly the prices of essential commodities for calculation of the minimum wage is always a debate , the price essential commodities by the using Consumer Price Index for Industrial Workers maintained by Labour Bureau, Shimla and the retail prices are showing different rates , the retail prices of essential commodities are at higher end including that of state Government run co-operative society’s compared to the retail prices maintained by Labour Bureau, Shimla by more than 15%, that is the prices maintained by Labour Bureau, Shimla are lower by more than 15% compared to market prices , the CG employees are deprived of proper minimum wage by an extent of 25% . If proper retail prices are taken into account the minimum wage shall be more than Rs 26,000/- as on 1st Jan 2016.

THE PAYMENT OF WAGES ACT, 1936:

The revision of payment of wages act, 1936 , the Government has raised the monetary limit of wages to Rs. 24000/- per month for the applicability of the Act by issuing the notification .This calculation of Rs 24,000/ is based on Dr. W.B. Aykroyd’s formula. This is done on the basis of figures of the Consumer Expenditure Survey published by the National Sample Survey Organization.

The payment of wages act, 1936 monetary limit of wages to Rs. 24000/- per month is for unskilled worker , if we add Rs 25% for skilled worker , it work out at Rs 30000/- for skilled worker which includes wages and allowances, at present the Central Government employees at the initial stage are paid Rs 23,000/- (Rs 18,000/ as minimum wage and Rs 5,000/ as allowances ), still there is gap of Rs 7,000/ , if the minimum wage of Central Government employees is re fixed at Rs 22,000/ then this gap shall be reduced.

The breakup of the Central Government employee’s salary is as follows.

Non Metro City
Minimum wage Rs 18,000/-
HRA Rs 1800/-
Transport allowances Rs 900/-
Children education allowances Rs 2250/-
Total Salary : Rs 22950/-

The Central Government employees are deprived of the actual minimum wage of Rs 26,000/-. Hence there is a need of revision of minimum wage from Rs 18,000/ as Central Government is a model employer.

Via : COC Karnataka

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GOVERNMENT OF INDIA
MINISTRY OF PERSONNEL, PUBLIC GRIEVANCES AND PENSIONS
(DEPARTMENT OF PERSONNEL & TRAINING)

LOK SABHA

UNSTARRED QUESTION NO. 2229
(TO BE ANSWERED ON 15.03.2017)

SERVICE/RETIREMENT BENEFITS

2229. SHRI SULTAN AHMED:

Will the PRIME MINISTER be pleased to state:

(a) whether the Government has reviewed or proposed to review the service and retirement benefits of Government employees;

(b) if so, the details thereof; and

(c) the changes made/proposed to be made in regard to deputation and early retirement policies?

ANSWER

Minister of State in the Ministry of Personnel, Public Grievances and Pensions and Minister of State in the Prime Minister’s Office. (DR. JITENDRA SINGH)

(a) to (b): The service and retirement benefits are decided and reviewed as per the recommendations of the Central Pay Commission (CPC) and acceptance/rejection of the same by the Government thereon. The recommendations of Seventh CPC have been considered by the Government and necessary resolutions have already been published in the Gazette of India.

(c): Vide DoPT’s O.M. No. 2/6/2016-Estt.Pay-II dated 17.02.2016, the Administrative Ministries/Departments and other borrowing organisations have been delegated powers to extend a deputation tenure upto seven years where absolutely necessary in public interest.This shall be subject to fulfilment of conditions prescribed in DoPT’s O.M. No. 6/8/2009- Estt.(Pay-II) dated 17.06.2010.

The voluntary retirement policy of AIS officers have also been aligned with other Central Government employees vide this Ministry’s Gazette Notification No.24012/04/2016.AIS-II(Pension) dated 27.02.2017.

Source: LOK SABHA

Lok Sabha Q&A, Retirement AGE

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Central government employees can expect to get the enhanced allowances by November this year when the special committee to examine the proposals submits its report.

The BJP-led NDA government is likely to take a decision about the hike in allowances for Central government employees by November this year when the panel appointed to examine it submits its report.
The committee headed by finance secretary has secretaries from home affairs, defence, health and family welfare as its members; the first meeting of the committee that was constituted on July 22 was held on August 4.

The information was given by finance minister Arun Jaitley to the Rajya Sabha on Tuesday in response to a question pertaining to the pay commission.

The hike in the salary component as recommended by the 7th Central Pay Commission (CPC) was accepted with retrospective effect from January 1, 2016. The arrears have been paid to the 47 lakh employees while 52 lakh pensioners are expected to get their arrears in due course.

A study by Tata Strategic Management Group had estimated the quantum of allowances at Rs. 34,000 crore. This could change if the committee differs from the hike proposed by the 7th CPC.
The committee has been asked to submit its report within four months. Therefore, a decision on increased allowances for about 1 crore employees and pensioners can be expected by November.

While approving the recommendations of the 7th CPC, the government has said in an official statement on June 29 that the committee to examine the allowances will submit its report in a time-bound manner.

The pay commission had recommended abolition of 51 allowances and subsuming 37 others after examining 196 allowances.
“Given the significant changes in the existing provisions for Allowances which may have wide ranging implications, the Cabinet decided to constitute a Committee headed by Finance Secretary for further examination of the recommendations of 7th CPC on Allowances. The Committee will complete its work in a time bound manner and submit its reports within a period of 4 months. Till a final decision, all existing Allowances will continue to be paid at the existing rates,” the statement said.
The Union Cabinet also decided to appoint two separate committees to examine implementation of pension under the National Pension Systems (NPS) and discrepancies/anomalies that could stem from implementing the 7th CPC.

The recommendations of the 7th CPC cover 47 lakh Central government employees and 53 lakh pensioners, of which 14 lakh employees and 18 lakh pensioners are from the defence forces.

Source: ibtimes

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Secretary, Staff-side, Standing Committee (National Council-Joint Consultative Machinery) said Staff-side is “not at all happy” with the recommendations of the CPC and, in fact, “no section of the employees is satisfied”, as the Commission has recommended a minimal pay increase as compared to the previous Pay Commissions.

The Secretary further stated that an amicable and mutually negotiated settlement of these demands is necessary as “non-acceptance would further cause resentment in the employees”.

The Secretary “informed that Staff-Side has already made their stand clear to go on strike from April 11, 2016 if their demands are not considered and no amicable settlement happens”, the Minutes said.

The meeting was held to discuss the issues raised by the National Joint Council of Action (NJCA) in their letter addressed to the Cabinet Secretary, regarding their Charter of Demands on the recommendations of the Pay Commission.

The Staff-side also said the central government employees need to be excluded from the National Pension Scheme (NPS), a long pending demand

The fixed monthly medical allowance for pensioners who are not covered by CGHS and REHS needs to be increased from Rs 500 to Rs 2,000 is another major demand.

The Joint Secretary (Implementation Cell) assured the Staff-Side that the concerns and demands made by them would be placed before the Empowered Committee of Secretaries for consideration after examining the same in the light of the recommendations of the Commission.

The scheme of Joint Consultative Machinery (JCM) is a platform for constructive dialogue between the representatives of the staff side and the official side for peaceful resolution of all disputes between the Government as employer and the employees.

Demands are submitted to the Implementation Cell, created in the Finance Ministry, to work as Secretariat for the Empowered Committee of Secretaries headed by Cabinet Secretary P K Sinha.

The Pay Commission recommendations when implemented would have bearing on remuneration of 47 lakh central government employees and 52 lakh pensioners. Subject to acceptance by the government, the recommendations will take effect from January 1, 2016.

Source: The Economic Times

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Various parameters such as fiscal deficit, current account deficit, foreign investment in govt bonds growth in GDP etc shows that of Economic Conditions now are better than 2008, the year when 6th CPC Pay was granted.

7th Pay Commission latest news – Present economic condition7th Pay Commission Latest News – Global financial services major UBS in a report said investors are complacent about any potential change in India’s policy framework, especially in the backdrop of 7th Central Pay Commission. The brokerage expects CPC to negatively impact government’s fiscal consolidation path and sees states to face bigger impact.

“Impact of CPC on Central government’s fiscal is likely 0.4 per cent of GDP, which many investors viewed as not a big deal. The impact is however much bigger on states (over 1.1 per cent of GDP),” said UBS in a report.

UBS added that its baseline scenario is of a staggered, delayed or diluted implementation of CPC, but also said that any delay or dilution to CPC would be a negative surprise for specific sectors and stocks.

The report further noted that consumption boost is not guaranteed even with CPC, neither is it surely sustainable beyond 2-3 quarters.

The brokerage pointed out following five reasons that make macro backdrop in 2016 look very different from that of 2008, the last time India adopted Central Pay Commission (CPC) and expanded fiscally:

1.  Fiscal deficit: Country’s central fiscal deficit was at 2.6 per cent as compared to 4.1 per cent in 2016, while combined fiscal deficit in 2008 came in at 4 per cent versus 6.3 per cent in 2016.
2. Current account deficit: CAD widening was financed easily in 2008 given improving global liquidity or risk appetite, although current environment doesn’t appear to be as conducive.
3. International investors: Global investors invested heavily in government bonds. They were 1/10th of the $30 billion now. They arguably care more for macro stability vs near-term growth.
4. GDP growth was slowing: GDP growth was not only slowing but also was ruling below trend versus a recovering (albeit slower than expected) economy now;
5. Election scenario: Lok Sabha election was in 2009, while next one is due in 2019.

The global brokerage sees year-end Nifty target in 2016 at 8,200 level, which offers better risk-reward post recent correction. Its downside scenario implies end-2016 Nifty of 7,000.

Source: Business Today

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Kolkata: The West Bengal Government has constituted the 6th Pay Commission for its own staff members and certain other categories of employees in the state to revise their salaries.

Economist Abhirup Sarkar, who is a professor of the Indian Statistical Institute, has been appointed chairman of the eight-member Pay Commission, which is scheduled to submit its report within six months.

The state Assembly elections are slated for next year and the setting up of the pay panel was made eight days after the Central Pay Commission submitted its report.

A Finance Department resolution yesterday said the decision was taken considering changes taken place in the structure of emoluments of state government employees in several respects since the 5th Pay Commission submitted its report.

The Commission will also cover employees of local bodies, panchayats, public undertakings, teaching and non-teaching staff of government aided and sponsored educational institutions.

As per its Terms and Reference, the Pay Commission would examine the present structure of pay and conditions of service, among other things.

It would examine the existing promotion policies and related issues and suggest suitable changes.

It would also examine various allowances, besides issues relating to retirement benefits.

To make recommendations on each of the above, the factors which will be considered included the prevailing pay structure under Central government, PSUs and other state governments, the economic condition of the country and the resources of the state government.

The Pay Commission will devise its own procedures and may take help of other departments and make estimate of the cost involved in implementing their recommendations.

“The Commission will submit their recommendations as expeditiously as practicable but preferably within a period of six months from the date of order notifying the constitution of the Commission,” the resolution said.

The Pay Commission may submit interim recommendations if found necessary or if so desired by the state government, it added.

PTI

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Every ten years, the Central Government of India sets up a Central
Pay Commission (CPC) to revise the pay scales of its employees. Since these pay scales are largely adopted by state governments as well, they influence the income of millions of households.During 2013, time seemed to be running out for the constitution of
the next Commission before the beginning of the election cycle. But on September 25, 2013, a week before the election-related Code of Conduct became effective, the government set up the Seventh Central Pay Commission. This commission will review and revise the salary and pensions of 50 lakh (5 million) or more Central Government employees.
Now that it is constituted, the Commission will most likely be able to
implement its recommendations by the scheduled date of January 1, 2016.

Duties of the Seventh Central Pay Commission

On Feb 28, 2014, the Cabinet approved the terms of reference of the
7th CPC. The CPC is expected to suggest a merger of 50% of DA (daily allowance) with basic pay, which would increase the gross salary of Central Government employees by around 30%. The Cabinet has approved an additional 10% DA over the existing 90% admissible DA, effective January 1, 2014. This increase would be paid in cash after the disbursement of March salary. The 7th CPC is required to submit its recommendation within a year and a half of its date of constitution.

Major issues to be resolved

1. Pay Parity between IAS & other government services:
Hundreds of letters are sent by IAS officers to the concerned
government officials apprehending that the seventh central pay
commission may try to restore parity between different government
services in terms of compensation and career progression. It is to be
seen how 7th CPC and government deals with this crucial issue.

2. Pay parity with private sector: Central services have demanded to every pay commission to create parity with the officers of private sectors and make their salary structure comparable to later.

3. Retirement age: There is no denial of the fact that working efficiency of an employee is influenced by the increasing age but experience often weighs heavily over the age factor. Even then
looking at attitude of present government impression is clear that pay commission is signaled to reduce the retirement age of government employees. Whatever circumstantial indications are available it shows that either 33 years of service of 60 years of age (whichever is minimum) is likely to be recommended. If media reports have ant substance of truth, under performers may be asked to opt for voluntary retirement after reaching the age of 55 years.

4. Pay gaps between least & highest paid employees:
In 1947, gaps in salary between lowest and highest paid government
employee was in the 1:41 ratio that got reduced to 1:12 by subsequent pay commissions. It has to be observed whether this gap is widened or reduced by the 7th CPC.

5. Continuing with grade pay system? It would be interesting to note whether 7th CPC continue grade pay system or adopts old pay scale system. As per reliable sources, grade pay system will not longer exists in 7th CPC structure. A table is circulating in the media predicting projected pay scales believed to be suggested by 7th CPC.

What are the hottest rumors?

1. Central Government is willing to merge 50% DA with basic pay with effect from 1.1.2015 – All Government employees would be happy if it has happened,

2. Age of Retirement will be determined based on completion of 33
Years of service or at the age of 58/60/62/65 Years (depending on
existing retirement age in various departments) whichever is earlier.

Members of the Seventh Central Pay Commission

Chairman – Ashok Kumar Mathur (Former Supreme Court Justice and Former Chairman, Armed Forces Tribunal)

Full time member – Vivek Rae (oil secretary)

Part time member – Rathin Roy (Director, NIPFP)

Secretary – Meena Agarwal (OSD, Department of Expenditure)

Latest update

• Union Cabinet chaired by PM on August 26, 2015 gave its approval for extension to 7th CPC to submit its report by the end of December 2015.
• As per reports in media, 7th CPC is likely to maintain status Que on the retirement age. However, some unconfirmed sources didn’t rule out the possibility of a suggestion from Pay Commission to the government that the earliest of either 33 years of service length or 60 years of age may be considered as a criteria for superannuation of central government employees.
• Recommendation for pay hike is likely to be low after merging the existing basic pay and dearness allowances. Merging the both component mean 155% rise and adding 25-35% extra makes it 1.8 to 1.9 times in terms of basic to basic.
• Grade Pay is likely to be abolished by 7th CPC and gaps between pay scales may widen and hence 7th CPC scale may some what follow the earlier pay formats (as in 3rd, 4th or 5th CPC)
• Government may not risk any adverse effect of disclosures related to pay recommendations on election prospects in upcoming Bihar elections.

Implementation Dates of Previous Pay Commission Recommendations

January 1, 1986 – 4th Pay Commission

January 1, 1996 – 5th Pay Commission

January 1, 2006 – 6th Pay Commission

The Pay Commission Process

Implementation of a Pay Commission’s recommendations always leaves behind a few anomalies for the next commission to resolve. Making recommendations for pay revision is a long process, involving discussion with various organizations, submission of demands by representatives of unions and associations, and evaluating the potential financial impact of these demands on the national exchequer. Representatives of various organizations are asked to make presentations. The Pay Commission
examines service conditions, pay, and perks given to employees.

All the earlier Commissions set up to revise the pay of Indian
Central Government employees—except the 6th CPC—took more than three years to submit their report. The Sixth Pay Commission submitted its report within just eight months. Nevertheless, such a quick turnaround cannot be taken for granted for future Pay Commissions, since the timing of report submission and the nature of the recommendations are influenced by political and economic considerations.

Rationale for the Seventh Pay Commission

The constitution of the Seventh Pay Commission is justified for the reasons listed below.

• Daily Allowance (DA) has already exceeded 100% of basic pay, and it cannot be merged with basic pay due to the recommendations of the 6th CPC.
• Since the wages of some categories of non-government employees are revised at intervals of less than ten years, wages should be revised every five years for central government employees also.
• Prompt pay revision of Central Government employees will help reduce the increasing disparities between Central Government employees, public sector employees, bankers, and private sector employees.How much increase in salary is expected after 7th CPC implementation

Other expected tasks for the 7th Pay Commission include resolving
anomalies created by the 6th CPC and addressing bonuses and problems related to the new pension program. All sections of employees will get an opportunity to present pay-related problems to the new Pay Commission and request redress of their grievances.

A new demand gaining support is constitution of a National Pay Panel that will make recommendations for all employees of the country. Since most of the states have adopted for their own employees the pay structure suggested by the 6th CPC for Central Government employees, uniform recommendations would remove discrimination between state and central employees. Recommending a uniform wage structure for each and every employee of India would also reduce pay disparities between private, public and autonomous organizations.

My poll indicates that 39% believe that Central Government employees are likely to get a threefold raise in salary. This is consistent with what was done in the past by earlier pay commissions. Given the existing trend in DA increase, salary may increase 2.3 times by the implementation date of the 7th CPC. Projected pay scales under this assumption are shown below.

Projected Pay Scales (After Implementation of the 7th CPC)

A projection based on media report is reproduced below. However, a
fake report in the name of 7th CPC is also being circulated in the media by some miscreants. 7th CPC has been granted extension by the Government of India to submit it report by the end of December 2015. It would be clear after the submission of report by 7th CPC what content it has submitted to the ministry for acceptance. Further, each and every point in the report will be examined by the cabinet and approved after considering all the implications. Till then enjoy and go through the speculations made by experts.

7th CPC as per some media reports has eliminated grade pay system and recommended pay scales similar to earlier pay commissions.

A better way to get rid of corruption in public life than across-the-board increases would be to legalize a commission on services
by each and every employee. This would also help improve the
productivity of private sector employees. In some private or autonomous banking institutions, for example, employees are paid a reasonable percentage for accomplishments such as encouraging customers to open more accounts.

Wage revision is expected for Central Government employees effective January 1, 2016. The newly constituted Pay Commission will get two years to review the existing wage structure and suggest a new one, to meet the expectation of employees, and also to increase efficiency at work at a pace with the growth in the economy.

The Seventh Pay Commission needs to introduce more parity into the pay structure of various sectors. Employees in all departments have been vested with more responsibilities, but their pay structure still belongs to the British period. People serving in the police and armed forces have very low salaries although their duties have become enormously more challenging. Government should increase the compensation to its officers for any service-related casualty. Police forces working under adverse conditions and in remote areas must be paid high wages and good benefits so that more people join these organizations.

The new pension system implemented based on the  recommendations of the 6th CPC needs to be revisited and reviewed by the 7th CPC, since the adequacy of fund management depends on market forces and the capabilities of fund managers. The 7th Pay Commission needs to take some vigorous action, based on discussions with trade unions, to come out with a more amicable solution for the new pension scheme.

These are some of the things people genuinely expect from the government, but time will tell how much people get from the CPC.

Source: Hubpages.com

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Sanjay R Bhoosreddy, Secretary of Central IAS Officers Association

New Delhi: About 20 central civil services, including IPS and IRS, have decided to petition Seventh Central Pay Commission (CPC) to seek job parity and career progression enjoyed by IAS officers.

A meeting of representatives of central civil services was held here recently and it was unanimously decided to petition the CPC to inform it about job-related anomaly, official sources said.

The petition, citing in detail the discrepancy, will soon be sent to the Seventh Central Pay Commission. The purpose behind sending such a request is to have parity and to end IAS supremacy, they said.

The move assumes significance as a war of words is going on between officers of Indian Administrative Service (IAS) and those belonging to other central government services over the issue.

Officers belonging to Indian Revenue Service (IRS), Railways and other such central services have been seeking pay parity and career benefits enjoyed by those in IAS.

Opposing this, about 200 IAS officers have written to Department of Personnel and Training, cadre controlling authority for their service, requesting it to stonewall any move that seeks to bring down the edge given to them over other services due to various reasons.

IAS officers get empanelled to a Joint Secretary-level post in 11 years while those belonging to IRS and other services get it after putting in at least 13 years of service.

The early empanelment gives an upper hand to IAS officer, in terms of higher pay and other pecuniary benefits, as compared to their batchmate of other services.

“There is a lot of frustration and resentment among the young officers. They have taken a conscious decision of joining IAS after viewing their career options.

“Some of them have left very good private sector jobs abroad and joined the civil services. Most of them were selected in other services but they chose to sit in exam again to become an IAS officer. The merit of these boys should not be ignored,” said Sanjay R Bhoosreddy, Secretary of central IAS officers’ association here.

“If there is no place for merit, then many meritorious aspirants may opt out of civil services,” Bhoosreddy said.

IPS officers’ association Secretary P V Ramasashtry said a service can plead for how much pay it should get but not what others should not get.

“When the pay commission is yet to finalise their recommendations, the move triggered by some IAS officers was premature and avoidable.

“A service can plead for how much pay it should get but not what others should not get. One cannot understand how extra two increments can be the sole motivation factor and removal of the same thoroughly demoralises an officer who claims himself superior to others?,” he asked.

Many comments are pouring on social networking sites like Facebook and micro-blogging portal Twitter by various officers of different services serving across the country on the issue.

PTI

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As we brace for another series of Pay Commission-mandated salary hikes, the question is if it is the best use of government resources.

As public servants get ready to enjoy the New Year’s blessing that the Seventh Pay Commission is expected to bestow, it may be a time for the rest of us to look this gift horse in the mouth. The Fourteenth Finance Commission estimates the cost of the Sixth Pay Commission at over Rs. 90,000 crore annually, since pay and allowances of Union government employees more than doubled between 2007-08 and 2011-12.Compare this to the estimates in the economic survey for the year 2011-12, about Rs. 70,000 crore each for food subsidy, fertilizer and petroleum subsidy and less than Rs. 40,000 crore for the Mahatma Gandhi National Rural Employment Guarantee Act. Simply put, the additional Central government expenditure due to the implementation of the Sixth Pay Commission was over 40 per cent of the major subsidies. If we take into account the costs to the State governments, the tab for Sixth Pay Commission largesse is probably equivalent to all the subsidies provided by the Central government.

As we brace for another Pay Commission-mandated salary hike, the
question to ask is not whether the government can afford it but if it is the best use of government resources. Government employees receive Dearness Allowance (DA) annually to compensate for inflation; they also receive an annual performance appraisal for promotions, which brings with it salary increases. So the decadal salary increases under the Central Pay Commission (CPC) are meant to address inequities in salaries across different parts of the government, across ranks as well as between the public sector and private sector. It is the latter that has provided the greatest justification for salary increases granted under CPC in the past.

False premiseDizzying salary packages reported for new Indian Institute of Management graduates or Indian Institute of Technology graduates funnel a sense of discontent among public sector employees since it is hard to imagine any 25-year-old government servant receiving a package of Rs. 40 lakh per annum. This smoke and mirrors strategy masks several observations made by the Sixth Pay Commission. First, it noted that the contention of vast disparities between private sector and government employees was not borne out by data. The CPC found that compensation to Group C and D employees in government was higher than that in the private sector; for
Group B it was similar and only for Group A was it lower. Group A
employees form less than 5 per cent of the total Central government
workforce; Group C and D are about 90 per cent. Second, it noted that a government job offers many other benefits not available in the private sector and the fear of flight away from public service towards the private sector is overblown.

“The Fourteenth Finance Commission estimates the cost of the Sixth Pay Commission at over Rs. 90,000 crore annually.”

In spite of these observations, the ultimate recommendations of the
Sixth CPC led to substantial increases in the salary and allowance of
all public servants, first in the Central service and later on in State
governments. A comparison of incomes between private sector employees
and government employees using data from India Human Development Surveys (IHDS) of 2004-05 and 2011-12 is instructive in understanding the consequences of the last CPC. These surveys of over 40,000 households were jointly organised by the National Council of Applied Economic Research and the University of Maryland. The graphic shows monthly salaries for men aged 25-59 in 2011-12. Many women work part time as anganwadi workers and ASHA workers and hence are excluded from this comparison, but their inclusion will not change the fundamental results.

The results show that at every single level of education, government
workers are paid more than private sector workers and more importantly, the public service advantage has increased rather than decreased after the implementation of the Sixth Pay Commission recommendations. A driver in government service earns far more than one in private service, but so does an engineer. This comparison does not include the other benefits government service provides including PF contributions, housing benefits, health insurance and, frequently, admission of children to coveted Kendriya Vidyalayas.

One might say that the problem is not global but is concentrated in
highly skilled positions. Individuals who are highly skilled may be more likely to choose the private sector. Here only the Union Public Service Commission can tell us if the qualification of the entering cohort of the Indian Administrative Service officers is declining, but at a slightly lower stratospheric level, we see no such evidence. The IHDS shows that among college graduates with a first class degree, government service still seems to be preferred. In 2004-05, among the male college graduates employed in public service, 37 per cent had a first division; this proportion had increased to 39 per cent by 2011-12. This is not to say that skill upgradation is not taking place in the private sector, where the proportion of first class degree holders among graduates has increased from 28 per cent to 35 per cent, but these figures do not suggest that government services are suffering on an average; just that the more qualified individuals are seeking salaried work and moving away from farming and small businesses benefitting both government service and the private sector.

“One might say that the problem is not global but is concentrated in highly skilled positions.”

That salary increases will be bestowed by the Seventh CPC is a given.
Whether it will address the real challenge, lower wages for Group A
officers compared to the private sector, and recognise the public
service advantage for the rest of the employees remains questionable.
Let us hope that the Seventh CPC will address the challenge of
government salaries with a scalpel rather than an axe.

(Sonalde Desai is senior fellow at the National Council of Applied
Economic Research and Professor of Sociology at the University of
Maryland. Views are personal.)

Source: TheHindu

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