Committee of Secretaries likely to recommend 30% hike with 24,000 as minimum pay

The Empowered Committee of Secretaries, who is processing the recommendations of the 7th Pay Commission, is likely to recommend a 30 per cent increase in the central government employees’ basic pay and minimum basic pay to Rs 24,000 per month, the biggest real-terms rise but not enough to restore employees’ pre-financial crisis value.

The Central government employees unions have said it will ensure that the central government employees’ minimum basic pay would rise to Rs 26,000 as against Rs 18,000 recommended by the 7th Pay Commission, that would undermine the Empowered Committee of Secretaries during the committee’s scheduled meeting tomorrow, he added.

The central government employees’ basic pay has not kept pace with inflation since the 2008, but the proposed increase would restore the real-terms value it has lost, he confirmed.

The 7th Pay Commission recommended a new pay scale for central government employees. Under this scale, the minimum basic salary is Rs 18,000 and maximum Rs 250,000. There are presently around 4.8 million central government employees and 5.2 million central pensioners.

Commission chairman Justice A K Mathur, along with the other members, placed the report before Finance Minister Arun Jaitley on 21 November last year. The commission this time recommended 14.27 per cent increase in basic pay, 23.55% overall increase in salary, allowances and pensions. The increase in allowances was recommended 63% while pension was proposed to rise 24%.

The government set up a 13 members secretary-level Empowered Committee, headed by Cabinet Secretary P K Sinha in January to process the pay panel’s recommendations that would put an additional burden of Rs 1.02 lakh crore on the exchequer.

An Implementation Cell has also been created in the Finance Ministry which works as the Secretariat of the Empowered Committee of Secretaries.

The Empowered Committee of Secretaries not only to purpose 30 percent basic pay hike of central government employees but also to recommend for doubling of existing rates of allowances and advances.

Concerning the issue of inflation, the official said, from past experience, it has been seen that when salaries rise, traders hike the prices of commodities too. There will be pressure on the private sector. This will increase inflation. However, this may not increase that much this time, if the government manages to effectively prevent the unnecessary propensity of business persons to increase prices.