New Delhi: The pay hike to provide just and fair compensation to central government employees will come into force from April, a top finance ministry official said. He said that the pay hike replacing pay and fitment formula for lower-level employees up to the pay matrix level 5, which had been recommended by the 7th pay commission and was approved by the Cabinet.
“This will be put into the Gazette in next financial year and will be implemented from April, 2018,” he said. The 7th Pay Commission recommendations of minimum pay from Rs 7,000 to Rs 18,000 while the maximum pay from Rs 90,000 to Rs 2.5 lakh with a fitment factor of 2.57 times uniformly of basic pay of 6th pay commission, was given nod by the Cabinet on June 29, 2016.
The pay panel recommendations are facing various shortcomings including pay ratio. Subsequent pay commissions had reduced the ratio of pay between lowest earning employees and top bureaucrats from 1:41 in 1947 to 1:12 in 2006, while the 7th Pay Commission increased its 1:14.
Hence, the central government employees’ unions had demanded minimum pay Rs. 26,000 instead of Rs 18,000 and 3.68 fitment factor for all employees. Accordingly, they had threatened to go on an indefinite strike over pay hike on July 11, 2016. The unions had suspended their indefinite strike on June 30, 2016 following the assurance from the Finance Minister Arun Jaitley to look into their “core demand of increasing Pay and fitment formula” through a High Level Committee.
Jaitley reiterated this commitment in Rajya Sabha on July 19, 2016 and the government formed National Anomaly Committee (NAC) in September, 2016 instead of High Level Committee to look into various pay related anomalies arising out of the implementation of the 7th Pay Commission’s recommendations. However, the Department of Personnel and Training (DoPT) issued a letter on October 30, 2017 stating that the decision for increasing the minimum pay and fitment formula as per the recommendation of the 7th pay commission does not come under the anomalies and therefore the issue is not a concern of the NAC.
Reacting to the DoPT letter, the finance ministry official said that the government is committed towards its responsibilities related with Finance Minister’s assurance. Accordingly, our ministry is mulling to increase the pay of employees, who get salaries from pay matrix level 1 to 5.