Earlier, the suggestions of the 7th Central Pay Commission were to be implemented with effect from 1st January 2016 however they were implemented in the September of 2016. In any case from these recommendations the central government employees stand to benefit from the hikes they will receive in their salary structure.
The 7th CPC recommendations cover approximately forty-seven lakh central government employees and fifty-three lakh pensioners. Minimum wage and maximum wage hikes for both civilian and defence personnel also come under the 7th CPC’s ambit.
In November 2015, the 7th CPC recommended a 14.27% hike in the basic pay of the junior level central government employees. This was comparably lower than their previous salary increases which happened through the pay commissions. In one instance, the previous iterations of the pay commission boast of a 40% hike in the basic pay of junior level central government employees in 2008.
Anyway, this revision made by the 7th Central Pay Commission increased the minimum compensation that can be awarded to a central government employee from Rupees 7,000 per month to Rupees 18,000 per month, i.e. a monthly increase of 11,000 Rupees in the salary.
Moreover, after the seventh pay commission, the maximum payment which can be drawn by a central government employee stands at Rupees 2.25 lakh per month for an employee at the Apex Scale and Rupees 2.5 lakh per month for someone at the Cabinet Secretary Level rather than the earlier Rupees 90,000, i.e. a minimum increase of Rupees 1 lakh 35 thousand per month.
For the Pay in Pay Band plus Grade Pay, the current Pay Matrix salary structure is recommended to be multiplied by a factor of 2.57 to obtain the new salary structure, i.e. the current salary structure is deemed to be 2.57 times the pre-seventh pay commission salary structure. This is the government’s fitment formula for the 7th Pay Commission.
The Seventh Pay Commission has allotted two dates each year for granting increments to central government employees, Jan 1st or July 1st rather than a single date, July 1st like before. The central government employees will be getting only a single increment each year as per the panel’s recommendations. That too shall depend on the employee’s date of appointment, employee’s last promotion date and the last time the employee was granted a financial upgradation.
Additionally, in an effort to avoid future iterations of pay commissions in India, the 7th CPC has recommended for a yearly annual increment of 3% of the concerned central government employees. Also, the 7th Central Pay Commission has brought the performance benchmark for Modified Assured Career Progression (MACP) to “Very Good” rating on the appraisal sheet. Before this the performance benchmark required for MACP was “Good”. However, the 10 year, 20 year and 30 year service slab continues in their appraisal structure.
The 7th Pay Commission has also put forth the suggestion that annual increments shall not be awarded to employees who are unable to meet their performance benchmarks for MACP and/or regular promotion in the initial twenty years of their period of service.
Considering that among the 47 lakh central govt. employees, only 14 lakh are serving and among the 53 lakh pensioners, 18 lakh are in the armed forces of the country, the seventh pay commission has recommended to do away with fifty three of the one ninety six allowances the central government employees receive. This will be done by clubbing allowances or deleting obsolete ones so as to gain more clarity and transparency. Moreover, you shall note that as per the central government estimates, in the year 2016-17, the 7th pay commission is going to cost the exchequer approximately Rupees 1 lakh Crore.