7th Pay Commission pension, pay scales and more: All
you wanted to know in 26 points
Pay Commission - calculators and highlights: The 7th Pay Commission has
recommended an average 23.55 per cent hike in salaries and allowances of
government staff. Market experts say that while on the one hand it will provide
a big stimulus to the economy in the coming years...
7th Pay Commission – calculators and highlights: The 7th
Pay Commission has recommended an average 23.55 per cent hike in salaries and
allowances of government staff. Market experts say that while on the one hand
it will provide a big stimulus to the economy in the coming years, on the other
it would be inflationary in nature and thus calls for delicate balancing
between growth and inflation. Be that as it may, here we provide, with tables
and charts all you wanted to know in as brief a manner as possible:
1. Recommended Date of implementation: 01.01.2016
2. Minimum Pay: Based on the Aykroyd formula, the minimum pay in government
is recommended to be set at ₹18,000 per month.
3. Maximum Pay: ₹2,25,000 per month for Apex Scale and ₹2,50,000 per month
for Cabinet Secretary and others presently at the same pay level.
4. Financial Implications:
a. The total financial impact in the FY 2016-17 is likely to
be ₹1,02,100 crore, over the expenditure as per the “Business As Usual”
scenario. Of this, the increase in pay would be ₹39,100 crore, increase in
allowances would be ₹ 29,300 crore and increase in pension would be ₹33,700
b. Out of the total financial impact of ₹1,02,100 crore,
₹73,650 crore will be borne by the General Budget and ₹28,450 crore by the
c. In percentage terms the overall increase in pay &
allowances and pensions over the „Business As Usual‟ scenario will be 23.55
percent. Within this, the increase in pay will be 16 percent, increase in
allowances will be 63 percent, and increase in pension would be 24 percent.
d. The total impact of the Commission‟s recommendations are
expected to entail an increase of 0.65 percentage points in the ratio of
expenditure on (Pay+Allowances+ Pension) to GDP compared to 0.77 percent in
case of VI CPC.
5. New Pay Structure: Considering the issues raised regarding the Grade Pay
structure and with a view to bring in greater transparency, the present system
of pay bands and grade pay has been dispensed with and a new pay matrix has
been designed. Grade Pay has been subsumed in the pay matrix. The status of the
employee, hitherto determined by grade pay, will now be determined by the level
in the pay matrix.
6. Fitment: A fitment factor of 2.57 is being proposed to be applied
uniformly for all employees.
7. Annual Increment: The rate of annual increment is being retained at 3
8. Modified Assured Career Progression (MACP):
a. Performance benchmarks for MACP have been made more
stringent from “Good” to “Very Good”.
b. The Commission has also proposed that annual increments not
be granted in the case of those employees who are not able to meet the
benchmark either for MACP or for a regular promotion in the first 20 years of
c. No other changes in MACP recommended
9. Military Service Pay (MSP): The Military Service Pay, which is a
compensation for the various aspects of military service, will be admissible to
the Defence forces personnel only. As before, Military Service Pay will be
payable to all ranks up to and inclusive of Brigadiers and their equivalents.
The current MSP per month and the revised rates recommended are as follows:
10. Short Service Commissioned Officers: Short Service Commissioned Officers
will be allowed to exit the Armed Forces at any point in time between 7 and 10
years of service, with a terminal gratuity equivalent of 10.5 months of
reckonable emoluments. They will further be entitled to a fully funded one year
Executive Programme or a M.Tech. programme at a premier Institute.
11. Lateral Entry/Settlement: The Commission is recommending a revised
formulation for lateral entry/resettlement of defence forces personnel which
keeps in view the specific requirements of organization to which such personnel
will be absorbed. For lateral entry into CAPFs an attractive severance package
has been recommended.
12. Headquarters/Field Parity: Parity between field and headquarters staff
recommended for similar functionaries e.g Assistants and Stenos.
13. Cadre Review: Systemic change in the process of Cadre Review for Group A
14. Allowances: The Commission has recommended abolishing 52 allowances
altogether. Another 36 allowances have been abolished as separate identities,
but subsumed either in an existing allowance or in newly proposed allowances.
Allowances relating to Risk and Hardship will be governed by the proposed Risk
and Hardship Matrix.
a. Risk and Hardship Allowance: Allowances relating to Risk
and Hardship will be governed by the newly proposed nine-cell Risk and Hardship
Matrix, with one extra cell at the top, viz., RH-Max to include Siachen
Allowance. The current Siachen Allowance per month and the revised rates recommended
are as follows:
This would be the ceiling for risk/hardship allowances and there would be no
individual RHA with an amount higher than this allowance.
b. House Rent Allowance: Since the Basic Pay has been revised
upwards, the Commission recommends that HRA be paid at the rate of 24 percent,
16 percent and 8 percent of the new Basic Pay for Class X, Y and Z cities
respectively. The Commission also recommends that the rate of HRA will be
revised to 27 percent, 18 percent and 9 percent respectively when DA crosses 50
percent, and further revised to 30 percent, 20 percent and 10 percent when DA
crosses 100 percent.
c. In the case of PBORs of Defence, CAPFs and Indian Coast
Guard compensation for housing is presently limited to the authorised married establishment
hence many users are being deprived. The HRA coverage has now been expanded to
d. Any allowance not mentioned in the report shall cease to
e. Emphasis has been placed on simplifying the process of
a. All non-interest bearing Advances have been abolished.
b. Regarding interest-bearing Advances, only Personal Computer
Advance and House Building Advance (HBA) have been retained. HBA ceiling has
been increased to ₹25 lakhs from the present Rs 7.5 lakhs.
16. Central Government Employees Group Insurance Scheme (CGEGIS): The Rates
of contribution as also the insurance coverage under the CGEGIS have remained
unchanged for long. They have now been enhanced suitably. The following rates
of CGEGIS are recommended:
7. Medical Facilities:
a. Introduction of a Health Insurance Scheme for Central Government
employees and pensioners has been recommended.
b. Meanwhile, for the benefit of pensioners residing outside the CGHS
areas, CGHS should empanel those hospitals which are already empanelled under
CS (MA)/ECHS for catering to the medical requirement of these pensioners on a
c. All postal pensioners should be covered under CGHS. All postal
dispensaries should be merged with CGHS.
18. Pension: The Commission
recommends a revised pension formulation for civil employees including CAPF
personnel as well as for Defence personnel, who have retired before 01.01.2016.
This formulation will bring about parity between past pensioners and current
retirees for the same length of service in the pay scale at the time of
The past pensioners shall first be fixed in the Pay Matrix being recommended by
the Commission on the basis of Pay Band and Grade Pay at which they retired, at
the minimum of the corresponding level in the pay matrix.
This amount shall be raised to arrive at the notional pay of retirees, by
adding number of increments he/she had earned in that level while in service at
the rate of 3 percent.
In the case of defence forces personnel this amount will include Military
Service Pay as admissible.
Fifty percent of the total amount so arrived at shall be the new pension.
An alternative calculation will be carried out, which will be a multiple of
2.57 times of the current basic pension.
The pensioner will get the higher of the two.
19. Gratuity: Enhancement in the
ceiling of gratuity from the existing ₹10 lakh to ₹20 lakh. The ceiling on
gratuity may be raised by 25 percent whenever DA rises by 50 percent.
20. Disability Pension for Armed
Forces: The Commission is recommending reverting to a slab based system for
disability element, instead of existing percentile based disability pension
21. Ex-gratia Lump sum Compensation
to Next of Kin: The Commission is recommending the revision of rates of lump
sum compensation for next of kin (NOK) in case of death arising in various
circumstances relating to performance of duties, to be applied uniformly for
the defence forces personnel and civilians including CAPF personnel.
22. Martyr Status for CAPF
Personnel: The Commission is of the view that in case of death in the line of
duty, the force personnel of CAPFs should be accorded martyr status, at par
with the defence forces personnel.
23. New Pension System: The
Commission received many grievances relating to NPS. It has recommended a
number of steps to improve the functioning of NPS. It has also recommended
establishment of a strong grievance redressal mechanism.
24. Regulatory Bodies: The
Commission has recommended a consolidated pay package of ₹4,50,000 and ₹4,00,000
per month for Chairpersons and Members respectively of select Regulatory
bodies. In case of retired government servants, their pension will not be
deducted from their consolidated pay. The consolidated pay package will be
raised by 25 percent as and when Dearness Allowance goes up by 50 percent. For
Members of the remaining Regulatory bodies normal replacement pay has been
25. Performance Related Pay: The
Commission has recommended introduction of the Performance Related Pay (PRP)
for all categories of Central Government employees, based on quality Results
Framework Documents, reformed Annual Performance Appraisal Reports and some
other broad Guidelines. The Commission has also recommended that the PRP should
subsume the existing Bonus schemes.
26. There are few recommendations of
the Commission where there was no unanimity of view and these are as follows:
i. The Edge: An edge is presently accordeded to the Indian
Administrative Service (IAS) and the Indian Foreign Service (IFS) at three
promotion stages from Senior Time Scale (STS), to the Junior Administrative
Grade (JAG) and the NFSG. is recommended by the Chairman, to be extended to the
Indian Police Service (IPS) and Indian Forest Service (IFoS).
Shri Vivek Rae, Member is of the view that financial edge is justified only for
the IAS and IFS. Dr. Rathin Roy, Member is of the view that the financial edge
accorded to the IAS and IFS should be removed.
ii. Empanelment: The Chairman and Dr. Rathin Roy, Member, recommend that
All India Service officers and Central Services Group A officers who have
completed 17 years of service should be eligible for empanelment under the
Central Staffing Scheme and there should not be “two year edge”, vis-à-vis the
IAS. Shri Vivek Rae, Member, has not agreed with this view and has recommended
review of the Central Staffing Scheme guidelines.
iii. Non Functional Upgradation for Organised Group ‘A’ Services: The
Chairman is of the view that NFU availed by all the organised Group `A‟
Services should be allowed to continue and be extended to all officers in the
CAPFs, Indian Coast Guard and the Defence forces. NFU should henceforth be
based on the respective residency periods in the preceding substantive grade.
Shri Vivek Rae, Member and Dr. Rathin Roy, Member, have favoured abolition of
NFU at SAG and HAG level.
iv. Superannuation: Chairman and Dr. Rathin Roy, Member, recommend the
age of superannuation for all CAPF personnel should be 60 years uniformly. Shri
Vivek Rae, Member, has not agreed with this recommendation and has endorsed the
stand of the Ministry of Home Affairs.
First Published on November 23, 2015
12:27 pm© The Indian Express Online Media Pvt Ltd