Big Bonanza for govt staff, Cabinet okays 24% hike in pay

Recommendations of the 7th Pay Commission got the Cabinet nod today, which will benefit over one crore government employees and pensioners.

The decision to this effect was taken in a meeting which was chaired by Prime Minister Narendra Modi, sources said.

The pay panel, in November last year, had recommended a 24.27% hike in basic pay at junior levels – the lowest in 70 years. The previous 6th Pay Commission had recommended a 20% hike, which the government doubled while implementing it in 2008.

The government in January had set up a high-powered panel under the Cabinet Secretary to process the recommendations of the 7th Pay Commission that will have a bearing on the remuneration of nearly 50 lakh central government employees and 58 lakh pensioners.

The Commission had recommended a 23.55% overall hike in salaries, allowances and pension involving an additional burden of ₹1.02 lakh crore, or nearly 0.7 % of GDP.

The entry-level pay has been recommended to be raised to ₹18,000 per month, from the current ₹ 7,000, while the maximum pay, drawn by the Cabinet Secretary, has been fixed at ₹ 2.5 lakh per month from the current ₹90,000.

While the Budget for 2016-17 did not provide an explicit provision for implementation of the 7th Pay Commission, the government had said the once-in-a-decade pay hike for government employees has been built in as interim allocation for different ministries.