New Delhi. After the implementation of the Seventh Pay Commission recommendations, there is good news for the Central Government employees. With the government contemplating a hike in minimum pay, it would relieve the all Government employees. The existing minimum pay is at Rs 18,000. Once the government decides to go ahead with the pay hike it would be at Rs 21,000.
What will be the pay hike
The Central government will increase the minimum pay to Rs 21,000. The demand was however to increase the minimum pay from Rs 18,000 to Rs 25,000. The Central government feels that this would help the low paid employees to a great extent. In addition to this the decision would also help eliminate poverty and stimulate the economy the government further feels. Union Finance Minister Mr. Arun Jaitley made a commitment to hike the minimum pay of central government employees beyond Rs 18,000.
How the fitment formula works
The minimum pay was fixed at Rs 18,000. In the last Pay Commission, the basic pay was Rs. 7,000. They multiplied it by 2.57 (fitment formula) and came to Rs. 18,000. We are demanding 3.68 fitment formula.
The indication is that once the central government takes a decision on this, the same would be effective from the January 1, 2016. It was decided that this was being done because the legislation would require an adjustment to the Consumer Price Index inflation measure.
Seventh Pay Commission recommendations unfriendly to the Economy
The Union Government employees union has been seeking a rise in the basic minimum pay. The unions have been saying that this would help the Indian economy. If spending increases, then it would benefit the economy. The cabinet approved the Seventh Pay Commission’s recommendations for central government employees on July 29 and have been implemented from January 1, 2016, which impacts the some 48 lakh central government employees and 52 lakh pensioners.