7th Pay Commission: Why the MSP hike could be an indicator of pay increase

New Delhi, July 7: News relating to the 7th Pay Commission have always raised the hopes of Central Government employees, but it has always ended up in disappointment. The CG employees have been relentlessly been demanding for a pay hike and increase in fitment factor, but the government appears to be sitting over the matter.

The question is whether the government will make an announcement immediately or will wait to make it a poll plank. What the government has to realise is that the recommendations made by the 7th Pay Commission was not sufficient to better the financial stability of the Central Government employees.

However what has raised some hopes among the CG employees is the increase in the Minimum Support Price. This is an indicator that the government has the money and the economy is looking good. Many feel that the MSP is just the beginning of a slew of measures that the government would be introducing.

While the hike in the MSP is an indicator that the government is ready to spend, the other million dollar question is would it drain out the coffers as a result of which the hike beyond the 7th Pay Commission would be put on hold.

The issue on hand is only being looked at with an election perspective. If the government is thinking in this manner alone, then it is crucial for it to announce a hike ahead of the elections considering this issue has a solid 50 lakh voter base.

The flip side to the issue is that a hike could be put on hold in case the elections are advanced to 2018 itself. The hike in MSP and the cost of conducting elections would be too heavy on the exchequer. In such an event making an announcement relating to the 7th Pay Commission would not be possible.

The 7th Pay Commission had recommended Rs 18,000 as the basic minimum pay. The government had contemplated raising that to nearly Rs 21,000. However the CG employees have been demanding that the hike stand at RS 26,000.