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Presented To : Prof. Poonam Arora
Presented By: Bhumika Chauhan(14)
WHAT IS A PAY COMMISSION ?
The pay commission is an administrative system/ mechanism
that the government of India set up in 1956 to determine the
salaries of government employees.
Since India’s independence ,seven pay commissions have
been set up on a regular basis to review and make
recommendations on the work and pay structure of all civil
and military divisions of the government of India.
Headquartered in Delhi, the commission is given 18 months
from the date of its constitution to make its
ALL PREVIOUS PAY COMMISSION
First Pay Commission:
The first pay commission was established on January, 1946
and was submitted to interim government of India.
Headed by Srinivasa Varadachariar.
Second Pay Commission:
The second pay commission was set up in August 1957, 10
years after independence.
The second pay commission had a financial impact of Rs
Chairman of the commission was Jagannath Das.
Third Pay Commission:
The third pay commission set up in April 1970.
The cost of the proposals was 1.44 billion
Chairman was Raghubir Dayal.
The third pay commission (3CPC) added three very
important concepts of Inclusiveness, Comprehensibility, an
adequacy for pay structure to be sound in nature.
Fourth Pay Commission:
Constituted in June 1983.
The financial burden on government was 12.82 billion.
Chairman of fourth pay commission was P.N. Singhal.
Fifth Pay Commission:
Setting up the Fifth pay commission was issued on 9 April
1994 but started functioning only on 2 May 1994.
Chairman of Fifth pay commission was Justice S. Ratnavel
Sixth Pay Commission:
In July 2006, the cabinet approved setting up of the sixth
Chairman was Justice B.N. Sri Krishna.
Focus mainly on removing ambiguity in respect of various
pay scales and to bring the idea of pay bands.
7TH PAY COMMISSION
The government of India has initiated the process to
constitute the 7th Pay Commission along with the finalization
its terms of reference.
On September 25, 2013 the finance minister P Chidambaram
announced that the Prime minister Manmohan Singh has
Approved the constitution of the 7th pay commission.
Its recommendations are likely to be implemented with
effect from January 1, 2016.
Justice A. K. Mathur will be heading the 7th Pay
Commission, announcement of which was done on 4th
Key members of this Pay Commission:
Name Designation Role in Commission
Justice Ashok Kumar
Retired Judge of the
Supreme Court and
Vivek Rae Secretary, Ministry of
Petroleum and Natural
Member (Full Time)
Dr. Rathin Roy Director, NIPFP Member (Full Time)
Meena Agarwal OSD, department of
KEY POINTS OF 7TH PAY COMMISSION
The commission has recommended a 16% hike in
basic salary + increase in DA and allowances like HRA.
The total increase will be 23.55% of the Gross salary(
Basic+ DA+ Allowances)
The minimum pay in govt. is recommended to be set at
Rs. 18,000 per month.
Maximum pay is recommended as Rs. 2,25,000 per
Rs. 2,50,000 per month for Cabinet Secretary and
others at the same level.
The rate of annual increment retained at 3%.
Short service commissioned officers will be allowed to
exit the armed forces at any point in time between 7 to
10 years of service.
Commission recommends abolishing 52 allowances;
another 36 allowances subsumed in existing
allowances or newly proposed allowances.
The commission has proposed a status quo on the
retirement age of central government employees.
Retirement age for staff employees is 60 years.
Total impact of are expected to entail an increase of
0.65% points in the ratio of expenditure on to GDP.
Recommendations will impact 47 lakh serving govt
employees;52 lakh pensioners, including defence
One Rank One Pension proposed for civilian
government employees on line of OROP for armed
Ceiling of gratuity enhanced from Rs. 10 lakh to Rs.
20 lakh; ceiling on gratuity to be raised by 25%
whenever DA rises by 50%.
Military Service Pay (MSP) ,which is a compensation
for the various aspects of military service, will be
admissible to the defence forces personnel only.
MSP for services officers more than doubled to
Rs.15,500 per month from Rs. 6,000 currently; for
nursing officers to Rs 10,800 from Rs. 4,200; for
JCO/ORs to Rs 5,200 from Rs. 2,000 and non-
combatants to Rs.3,600 from Rs. 1,000.
Financial impact of implementing recommendations will
be Rs. 1.02 lakh crore-Rs. 73,650 crore to be borne by
Central Budget and Rs. 28,450 crore by Railway
The 16% hike in basic salary is much lower than the
35% hike employees got in the sixth Pay Commission.
IMPORTANT DEMANDS OF THIS PAY
Pay scales are calculated on the basis of pay drawn in pay
band + GP+ 100% DA by employees as on 01/01/2014.
7th CPC report should be implemented w.e.f. 01/01/2014. In
future five year wage revision.
Scrap New Pension Scheme and cover all employee under
Old Pension and Family Pension Scheme.
JCM has proposed minimum wage for MTS(skilled) Rs.
Ratio of minimum and maximum wage should be1:12.5.
General formula for determination of pay scale based on
minimum minimum living wage demanded for MTS is pay
Annual rate of increment @3% of the pay.
Fixation of pay on promotion= minimum two increments.
Dearness Allowances on the basis of 12 monthly average
of CPI, Payment on 1st Jan and 1st July every year.
Overtime Allowances on the basis of total Pay + DA+ Full
Liabilities of all Government dues of persons died in
harness be waived.
Transfer Policy- Group ‘C and D’ Staff should not be
transferred. DoPT should issue clear cut guideline as per 5th
CPC recommendation. Govt should form a Transfer Policy
in each department for transferring on Mutual basis on
promotion. Any order issued in violation of policy framed
be cancelled by head of department on representation.
(c)Wages and service conditions of Garmin Dak Sevaks is
to be examined by 7th CPC itself. Detailed Memorandum
will be submitted by Postal Federations and GDS Unions.
X classified City Other Places
Rs. 7500+ DA Rs. 3750+DA
The stipulation for TA that the Govt. employee should be on
duty in his headquarters for certain number of days during the
calender month should be removed.
Deputation Allowance double the rates and should be paid
10% of the pay at same station and 20% of the pay at
Classification of the post should be executive and non-
executive instead of present Group A.B.C.
Special Pay which was replaced with Special/Allowance by
4th CPC be bring back to curtail pay scales.
Scrap downsizing, outsourcing and contracting of govt.
Regularize casual labour and count their entire service after
first two year, as a regular service for pension and all other
benefits . They should not be thrown out by engaging
The present MACPs Scheme be replaced by giving five
promotion after completion of 8,15,21,26 and 30 year of
service with benefits of stepping up of pay with junior and
also hierarchical pay scales.
PLB being bilateral agreement ,it should be out of 7th
(a) To achieve 70% houses in Delhi and 40% in all other
town to take lease accommodation and allot to the govt.
(b) Land and building acquired by it department may be used
for constructing houses for govt. Employees.
House Building Allowance:-
(a) Simplify the procedure of HBA
(b) Entitle to purchase second and used houses
Common Category – Equal Pay for similar nature of work
Compassionate appointment –remove ceiling of 5% and
give appointment within three months.
Category A1, A class city Other Cities
Executive Rs. 5000 per day + DA Rs. 3500 per day+ DA
Non- Executive Rs. 4000 per day+ DA Rs. 2500 per day+ DA
Composite Transfer Grant:-
-Executive class 6000 kg Goods Train/Rate per km by road 8
Wheeler Wagon Rs.50+DA(Rs. 1 per kg and single container
-Non- Executive Class 3000kg-do- - do-
Children Education Allowance should be allowed up to
Graduate, Post Graduate, and all Professional Course.
Allow any two children for children Education Allowance.
Fixation of pay on promotion –two increments in feeder
grade with minimum benefit of Rs. 3000.
House Rent Allowance-
X class Cities 60%
Other classified Cities 40%
Unclassified Locations 20%
Compensatory City Allowance.
‘X’ Class Cities ‘Y’ Class Cities
A. Pay up to Rs. 50,000 10%
B. Pay above Rs. 50,000 6% minimum Rs. 5000 3%
minimum Rs. 2500.
Patient Care Allowance to all Para-medical and staff
working in hospitals.
All allowances to be increased by three times.
NE Region benefits –Payment of Special Duty
Allowance@ 37.5% of pay.
Training:- Sufficient budget for in-service training.
1) Increase Casual leave 08 to 12 days & 10 days to 15 days.
2) Declare May Day as National Holiday.
3) In case of Hospital Leave , remove the ceiling of maximum 24
months leave and 120 days full payment and remaining half
4) Allow accumulation of 400 days earned Leave.
5) Allow encashment of 50% leave while in service at the credit
after 20 years qualifying Service.
6) National Holiday Allowance(NHA)- Minimum one day salary
and eligibility criteria to be removed for all Non Executive
7) Permit Encashment of Half Pay Leave.
8) Increase Maternity leave to 240 days to female employees
& increase 30 days .Paternity Leave to male employees.
(a) Permission to travel by air within and outside the NE
(b) To increase the periodicity once in a two year.
(c) One visit outside country in a lifetime.
1) Allow 30% standard deduction to salaried employees.
2) Exempt all allowances.
3) Raise the ceiling limit as under:
(a) General- 2 lakh to 5 lakh.
(b) Sr. Citizen – 2.5 lakh to 7 lakh.
(c) Sr. Citizen above 80 years of age -5 lakh to 10 lakh
4)No income Tax on pension and family pension and
Effective grievance handling machinery for all non-
a) Spot settlement
b) Maintain schedule of three meetings in a year
c) Department Council be reviewed at all levels
d) Arbitration Award be implemented within six month, if
not be discussed with Staff Side before rejection for
finding out some modified form of agreement.
Date of Increment -1st January and 1st July every year. In
case of employees retiring on 31st December and 30th June,
they should be given one increment on last ay of service,
i.e, 31st December and 30th June , and their retirements
benefits should be calculated by adding the same.
Appoint Arbitrator for shorting all pending anomalies of
the 6th CPC.
General Insurance Active Insurance Scheme covering
risk up to Rs. 7,50,000/- to Non Executive & Rs.
3,50,000/- to skilled staff by monthly contribution of
Rs. 750/-& Rs. 350/- respectively.
Point to point fixation of pay.
Extra benefits to Women employees:-
1) 30% reservation for women
2) Posting of husband and wife at same station
3) One month special rest for chronic disease
4) Conversion of Child Care Leave into Family Care
5) Flexi time.
1) Existing ceiling of 16 ½ months be removed and
Gratuity be paid @ half month salary for every year of
2) Remove ceiling limit of Rs. 10 lakh for Gratuity.
1) Pension@67%of Last Pay Drawn (LPD) instead of 50%
2) Pension after 10 years od qualifying service in case of
3) Increase pension age-based as under:
65years-70% of Last Pay Drawn(LPD)
70years -75% of LPD
75years-80% of LPD
80years-85% of LPD
85years-90% of LPD
90years-100% of LPD
4) Parity of pension to retirees before 1/1/2006.
5) Enhanced family pension should be same in case of death
in harness and normal death.
6)After 10 years, family pension should be 50% of LPD.
7) Family pension to son up to the age of 28 years looking to
the recruitment age.
8) Fixed Medical Allowance (FMA) @ Rs. 2500/-month.
9) Extend medical facilities to parents also.
10) HRA to pensioners.
11) Improvement in ex-gratia pension to CPF/SRPF retirees
up to 1/3rd of full pension.