Tuesday, October 13, 2015


New Delhi: The Seventh Pay Commission is likely to propose pay hike for central government employees, which will be highest since first pay commission’s proposal in 1947.

The first pay commission was constituted in 1946, while its submitted its report on May, 1947 to the interim government of India. ‘Living wage’ — the guiding principle for the first Pay Commission — is long past.
‘Now is Seventh Pay Commission time’, which is also to take in to account living cost of central government employees cost of their appraisal.
The cost of living measures the annual cost of necessities for one adult to live a secure, yet modest, lifestyle by estimating the costs of housing, food, transportation, health care, other necessities, and taxes.
Every government employee likely has a six-member family including his parents. So, Seventh Pay Commission is likely to increase salaries and allowances to minimise the impact on the cost of living for 50 lakh central government employees and 56 lakh pensioners including dependents.
Inflation pushes living cost, inflation, is an economic concept. The effect of inflation is the prices of everything going up year by year. A central government employee got salary Rs 3000 in 1987 under Sixth pay commission, now he gets Rs 80,000 with two promotion, this is called inflation, the price of everything goes up. When the price goes up, the salaries go up.
Every successive Pay Commission has roughly tripled pay. This means that simply by hiking up living cost for 10 years, a government employee would have tripled his pay.
The first pay commission was recommended Rs 55 salary to the lowest earning employee, second Rs 80, third Rs 185, fourth Rs 750, fifth Rs 2550 and sixth Rs 6660.
Accordingly, the Seventh Pay Commission is likely to propose minimum basic salary Rs 20,000 of central government employees, sources in the pay panel said.
The main reason behind the proposal of Seventh Pay Commission is to hike highest pay since 1947 on the account of Dearness Allowance (DA). The central government employees will get Dearness Allowance likely 125 percent at the time implementation of Seventh pay Commission. They never got such type of Dearness Allowance hike before implementation of any Pay Commission.
Dearness Allowance always merges with salaries and allowances under every pay commission’s proposal.
“The Seventh Pay Commission is ready with recommendations and the report will be submitted soon,” according to sources.
Headed by Justice Ashok Kumar Mathur, the Seventh Pay Commission was appointed in February 2014 and its recommendations are scheduled to take effect from January 1, 2016.
The government constitutes the Pay Commission almost every 10 years to revise the pay scale of its employees and often states also implement the panel’s recommendations after some modifications. The first pay commission was constituted in 1946, second in 1957, third in 1970, fourth in 1983, fifth in 1994, sixth in 2006 and seventh in 2014.
As part of the exercise, the Seventh Pay Commission holds discussions with various stakeholders, including organisations, federations, groups representing civil employees as well as defence services.
Meena Agarwal is the secretary of the Commission. Other members are Vivek Rae, a retired IAS officer of 1978 batch and Rathin Roy, an economist.
The Sixth Pay Commission was implemented with effect from January 1, 2006, the fifth from January 1, 1996 and the fourth from January 1, 1986.

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