Thursday, June 30, 2016

Confusion over HRA after cabinet approval

Central employees are confused about allowances after the official press release. As per the official statement,
” The Commission examined a total of 196 existing Allowances and, by way of rationalization, recommended abolition of 51 Allowances and subsuming of 37 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 above press release  concluded with a statement of ” Till a final decision, all existing Allowances will continue to be paid at the existing rates”
Since the House Rent Allowance also listed among one of these 196 Allowances, the status HRA is not clear now. The existing rates of HRA is 30%, 20% and 10% for class X, Y and Z respectively. Whether these existing rates of HRA will be paid based on revised pay or pre revised pay ?

Also Read : Central employees on indefinite strike from 11th July
There are difference of opinions among the employees and Govt. should clear the air with suitable clarification or employees will have to wait for the notification.

Unhappy with little hike, central employees to go on strike from 11th July

"It has been noticed that there is no improvement in Minimum Wage and Multiplying Factor as well, which was our hard pressed demand. Instead, wages, as recommended by the VII CPC have been accepted as it is, which is highly disappointing.

Only two committees have been formed, one to take care of the allowances and another for National Pension Scheme, which will submit their reports within four months time.

It is quite unfortunate that, our demand for improvement in the report of the VII CPC has not been considered by the government.

Therefore, it would be quite appropriate that, we should go ahead with our preparations for “Indefinite Strike”, slated to be commended from 06:00 hrs. on 11th July, 2016.

You are also advised to intensify the mass mobilization and strong protests on all the offices and establishments be organized tomorrow, i.e. on 30.06.2016."
----as per National Joint Council Of Action circular  Dated 29.06.2016

Wednesday, June 29, 2016

Highlights of the 7th CPC report as approved by cabinet

No betterment in multiplication factor of 2.57
The Union Cabinet chaired by the Prime Minister Shri Narendra Modi has approved the implementation of the recommendations of 7th Central Pay Commission (CPC) on pay and pensionary benefits.   It will come into effect from 01.01.2016.

Highlights:

1.            The present system of Pay Bands and Grade Pay has been dispensed with and a new Pay Matrix as recommended by the Commission has been approved. The status of the employee, hitherto determined by grade pay, will now be determined by the level in the Pay Matrix. Separate Pay Matrices have been drawn up for Civilians, Defence Personnel and for Military Nursing Service. The principle and rationale behind these matrices are the same.

2.            All existing levels have been subsumed in the new structure; no new levels have been introduced nor has any level been dispensed with. Index of Rationalisation has been approved for arriving at minimum pay in each Level of the Pay Matrix depending upon the increasing role, responsibility and accountability at each step in the hierarchy.

3.            The minimum pay has been increased from Rs.  7000 to 18000 p.m.  Starting salary of a newly recruited employee at lowest level will now be Rs.  18000 whereas for a freshly recruited Class I officer, it will be Rs.  56100.  This reflects a compression ratio of 1:3.12 signifying that pay of a Class I officer on direct recruitment will be three times the pay of an entrant at lowest level.

4.            For the purpose of revision of pay and pension, a fitment factor of 2.57 will be applied across all Levels in the Pay Matrices.


5.            Rate of increment has been retained at 3 %. This will benefit the employees in future on account of higher basic pay as the annual increments that they earn in future will be 2.57 times than at present.

6.            The Cabinet approved further improvements in the Defence Pay Matrix by enhancing Index of Rationalisation for Level 13A (Brigadier) and providing for additional stages in Level 12A (Lieutenant Colonel), 13 (Colonel) and 13A (Brigadier) in order to bring parity with Combined Armed Police Forces (CAPF) counterparts at the maximum of the respective Levels.

7.            Some other decisions impacting the employees including Defence & Combined Armed Police Forces (CAPF) personnel include :

·               Gratuity ceiling enhanced from Rs.  10 to 20 lakh. The ceiling on gratuity will increase by 25 % whenever DA rises by 50 %.
·               A common regime for payment of Ex-gratia lump sum compensation for civil and defence forces personnel payable to Next of Kin with the existing rates enhanced from Rs. 10-20 lakh to 25-45 lakh for different categories.
·               Rates of Military Service Pay revised from Rs.  1000, 2000, 4200 & 6000 to 3600, 5200, 10800 & 15500 respectively for various categories of Defence Forces personnel.
·               Terminal gratuity equivalent of 10.5 months of reckonable emoluments for Short Service Commissioned Officers who will be allowed to exit Armed Forces any time between 7 and 10 years of service.
·               Hospital Leave, Special Disability Leave and Sick Leave subsumed into a composite new Leave named ‘Work Related Illness and Injury Leave’ (WRIIL). Full pay and allowances will be granted to all employees during the entire period of hospitalization on account of WRIIL.

8.            The Cabinet also approved the recommendation of the Commission to enhance the ceiling of House Building Advance from Rs.  7.50 lakh to 25 lakh. In order to ensure that no hardship is caused to employees, four interest free advances namely Advances for Medical Treatment, TA on tour/transfer, TA for family of deceased employees and LTC have been retained. All other interest free advances have been abolished.

9.            The Cabinet also decided not to accept the steep hike in monthly contribution towards Central Government Employees Group Insurance Scheme (CGEGIS) recommended by the Commission. The existing rates of monthly contribution will continue. This will increase the take home salary of employees at lower levels by Rs. 1470. However, considering the need for social security of employees, the Cabinet has asked Ministry of Finance to work out a customized group insurance scheme for Central Government Employees with low premium and high risk cover.

10.        The general recommendations of the Commission on pension and related benefits have been approved by the Cabinet. Both the options recommended by the Commission as regards pension revision have been accepted subject to feasibility of their implementation. Revision of pension using the second option based on fitment factor of 2.57 shall be implemented immediately. A Committee is being constituted to address the implementation issues anticipated in the first formulation. The first formulation may be made applicable if its implementation is found feasible after examination by proposed Committee which is to submit its Report within 4 months.

11.        The Commission examined a total of 196 existing Allowances and, by way of rationalization, recommended abolition of 51 Allowances and subsuming of 37 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.

12.        The Cabinet also decided to constitute two separate Committees (i) to suggest measures for streamlining the implementation of National Pension System (NPS) and (ii) to look into anomalies likely to arise out of implementation of the Commission’s Report.

13.        Apart from the pay, pension and other recommendations approved by the Cabinet, it was decided that the concerned Ministries may examine the issues that are administrative in nature, individual post/ cadre specific and issues in which the Commission has not been able to arrive at a consensus.

14.        As estimated by the 7th CPC, the additional financial impact on account of implementation of all its recommendations in 2016-17 will be Rs. 1,02,100 crore. There will be an additional implication of Rs. 12,133 crore on account of payments of arrears of pay and pension for two months of 2015-16.

FM tweeted : ‘Historic’ salary hike for Central employees

Finance Minister Arun Jaitley on Wednesday took to Twitter to announce the Union Cabinet’s decision approving the 7th Pay Commission’s recommendations.
In a tweet this afternoon, Jaitley said: “Congratulations to central government officers, employees & pensioners on a historic rise in their salary & allowances through the 7th CPC.”

It is still not known whether the cabinet has made any betterment in the proposal of the pay panel. Hopefully Govt. will issue official press release later in the day. 


Cabinet clears 7th Pay Commission recommendations

As per PTI news, Cabinet cleared pay commission recommendations. Details are awaited. Govt. will brief the media shortly and the final outcome may be known.

Monday, June 27, 2016

7th Pay Commission : Cabinet likely to approve on 29th June

Update as on 12 Noon 29.06.16 : Cabinet meeting is in progress. Govt. will brief the media when it is over.
The much awaited seventh pay commission is going to enter the last phase of implementation soon.


A Committee of Secretaries headed by Cabinet Secretary P.K. Sinha has submitted its report on the recommendations of the Seventh Pay Commission which may be accepted, a financial ministry official said.
Based on the panel’s report, the Finance Ministry is preparing a Cabinet note and the issue may come up for approval by the Cabinet as early as June 29.

“Committee of Secretaries (CoS) has finalised its report on Pay Commission recommendations... We will soon (file) draft Cabinet note based on the report,” Finance Secretary Ashok Lavasa said here on Monday.  - Source : The Hindu
As per reports, Prime Minister has directed Finance Ministry to implement the Pay Commission for government employees, and place the Empowered Group of Secretaries report on the central government employees' salary and allowances hike in the next Cabinet meeting on Wednesday, June 29.

Saturday, June 25, 2016

Brexit fallout: Govt may delay implementation of Seventh Pay Commission by three months

Media Report :
It seems that the consequences of Brexit have some initial repercussion on India. According to reports, the Narendra Modi government may delay the implementation of much awaited Seventh Pay Commission by two-three months.
Reports say that the delay is because of the volatility in the markets following Britain's decision to exit the European Union. And it will take at least three months for the markets to re-stabilize.

Friday, June 17, 2016

Cabinet likely to approve salary hike by a fortnight

As per Zee News : "The secretaries panel reviewing the 7th pay commission's recommendations have submitted its report to the Finance Ministry. The Finance Ministry will prepare a note and present it before the Cabinet in the next 15 days."
Click here to read more
Other media reports :
The much awaited Seventh Pay Commission will be approved by the end of this month. According to reports the Union Cabinet officials reviewing the recommendations made by the commission is likely to approve the bill after which proposed hike salaries will be credited on the account of central government employees from August 1.
Further cabinet meetings which is likely to be held by the end of this month will give a final touch to the recommendation and will approve it also.

Thursday, June 16, 2016

Media reports substantial pay hike for central employees

Govt employees to get  hiked salary from August, arrears in one installment ahead of Dusshera

 The central government employees and pensioners are likely to get their 6 months of arrears just ahead of the Dusshera festival in October.
As per media report, increased salary of July will be credited to the 47 lakh central government employees and 52 lakh pensioners' accounts on August 1, 2016. But the arrears of last 6 months will be credited in one installment ahead of the Dusshera in October.
As per sources, the Empowered Committee of Secretaries headed by the Cabinet Secretary Pradeep Kumar Sinha has recommended a 30 percent increase in minimum and maximum basic pay structures along with doubling of existing rates of allowances and advances.
The 7th Pay Commission had suggested a maximum basic pay of Rs 2,50,000 and a minimum of Rs 18,000. A 30 percent increase would translate into maximum salary of Rs 3,25,000 and minimum at Rs 23,400, respectively.

Tuesday, June 14, 2016

Adhoc Bonus for West Bengal employees

The amount of ad-hoc bonus, subject to maximum amount of Rs.3,400/- only.

"The undersigned is directed by order of the Governor to say that the Governor is pleased to decide that the State Government employees who are not covered by any of the productivity linked Bonus Scheme and whose revised emoluments did not exceed Rs.25,000/ – per month as on 31st March, 2016 will be entitled to ad-hoc bonus for the accounting year 2015-2016 at the rate of Rs.3,400/- per head. The upper eligibility ceiling of Rs.25,000/- p.m. ‘as on 31st March, 2016 will be applicable irrespective of whether the emoluments are drawn in the pre-revised or revised scale of pay or on fixed.’ consolidated contract pay."
Click here for the order

Monday, June 13, 2016

GPF Interest rate slashed to 8.1% for the first Qr of 2016-17

In line with the recent interest rate cut in different small savings scheme, Central Govt. slashed GPF interest rate to 8.1% for the first quarter of 2016-17.
It may be mentioned that from this year onward interest rate will be reviewed on quarterly basis.
Click here for the FinMin resolution

Sunday, June 12, 2016

7th CPC Update : Secretaries' panel did not meet on 11th June, may decided pay scale on 14th June

7th CPC: Secretaries panel yet to decide final monthly salary for central government employees

The meeting of the Empowered Group of Secretaries reviewing the 7th Pay Commission, to finalize the payout to the central government employees did not take place as scheduled earlier on Saturday.
The office of the Cabinet Secretary confirmed that the meeting did not take place on Saturday. It did not reveal either when would the secretaries panel meet again to give the final shape to the salaries of central government employees.

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