Seventh Pay Commission: 10 things in a capsule

New Delhi, June 30: The Centre on Wednesday (June 29) okayed the 7th Pay Commission's recommendations as a result of which the salaries of government employees and pensions for retired personnel would go up. [7th Pay Commission: Govt employees not happy]

The approval, which was granted at a Cabinet meeting chaired by Prime Minister Narendra Modi, will impact around 47 lakh central government employees and 52 lakh pensioners. The Cabinet approved a recommendation for a minimum monthly pay of Rs 18,000 with the upper limit of Rs 2,25,000 a month. [Congress calls 7th Pay Commission "worst pay hike"]

Here we have a look at 10 important points of the recommendations that the Cabinet has approved:

1. The prevailing system of pay bands and grade pay has been scrapped and replaced by a new pay matrix which was recommended by the commission. In fact, distinct pay matrices have been put in place for civilians, defence personnel and military nursing service officials. The new pay matrix would ensure that there is a consistence in rise of salaries upon promotion in various pay bands. The prevailing levels have been uncorporated in the new structure and no new level has been started.

2. The minimum monthly pay has been raised from Rs 7,000 to Rs 18,000. The starting salary of a fresh recruit at the lowest level will now be Rs 18,000 while that for a just recruited Class I officer will be Rs 56,100. The overall hike in pay is 23.55 per cent.

3. For revising pay and pension, a fitment factor of 2.57 will be used in the pay matrices. The salary/pension of government employees/retired personnel will be increased by at least 14.29 per cent as on January 1 this year.

4. The rate of increment has been maintained at three per cent. This is expected to benefit the employees later on account of higher basic pay since their annual increments in future will be 2.57 times that of the present.

5. The government has also approved improvements in the defence pay matrix by raising Index of Rationalisation for Level 13A which is that of the Brigadier and providing additional stages in Level 12A which is of the Lieutenant Colonel, 13 (colonel) and 13A to effect a parity with their Combined Armed Police Forces (CAPF) counterparts.

6. Other decisions related to the defence and CAPF personnel include: raising the gratuity limit from Rs 10 to 20 lakh (the ceiling will be raised by 25 per cent whenever the DA goes up by 50 per cent); a common regime for payment of ex-gratia lumpsum compensation for the civil and defence personnel payable to the next of kin with the prevailing rates raised from Rs 10-20 lakh to Rs 25-45 lakh for various categories and revision of rates of military service pay for various categories; executing a new leave system called 'Work Related Illness and Injury Leave'.

7. The Cabinet has also decided to constitute two different committees---(1) to recommend measures for streamlining the execution of the National Pension System and (2) to look into anomalies likely to come up following implementation of the panel's report.

8. The general recommendations of the panel on pension and related benefits have also been okayed by the Cabinet. Revision of pension using the fitment factor of 2.57 shall be implemented at the earliest.

9. Apart from the recommendations related to pay, pension and others approved by the Cabinet, it was also decided that the concerned ministries may examine issues that are administrative in nature, specific to individual post/ cadre and those in which the commission has not been able arrive at an agreement.

10. The Cabinet also approved the panel's recommendation to raise the ceiling of House Building Advance from Rs 7.50 lakh to Rs 25 lakh.

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