7th Pay Commission: Govt employees to get arrears in one installment along with August salaries

Zee Media Bureau

New Delhi: In what could bring cheers to lakhs of central government employees and pensioners, the Ministry of Finance on Friday said that arrears shall be paid in cash in one installment along with the payment of salary for the month of August, 2016, as per the 7th Pay Commission recommendation.

Ministry of Finance issued instructions for the implementation of recommendations of 7th CPC - fixation of pay and payment of arrears.

The ministry has tweeted:

Ministry of Finance issues instructions for the implementation of recommendations of 7th CPC - fixation of pay and payment of arrears — Ministry of Finance (@FinMinIndia) July 29, 2016

The Finance Ministry also said that the revised pay structure effective from January 1, 2016, would include the Dearness Allowance of 125 per cent provided in the pre-revised pay structure. The rate of the first installment of DA under revised pay will be announced later.

"The arrears as accruing on account of revised pay consequent upon fixation of pay under CCS (RP) Rules, 2016 with effect from January 1, 2016, shall be paid in cash in one installment along with the payment of salary for the month of August, 2016, after making necessary adjustment on account of GPF and NPS, as applicable, in view of the revised pay," a finance ministry statement said.

To expedite disbursement of arrears, it is decided that arrear claims may be paid without pre-check of fixation of pay in revised scales of pay, the ministry said in a circular.

However, facilities to disburse arrears without pre-check of fixation of pay won't be available for Govt servants who have relinquished service on account of dismissal, resignation, discharge, retirement etc after date of implementation of Pay Commission's recommendations.

The Union government recently issued notification for the implementation of the 7th Pay Commission recommendations related to the hike in basic pay and pension.

With the publication of notification, dated July 25, 2016,  around 1 crore individuals — 33 lakh central government employees, 14 lakh armed forces personnel, and 52 lakh pensioners will get the increased payout for their August salaries.

The 7th Pay Commission recommendations on basic pay and pension hike will be effective from January 1, 2016, according to the gazette.

After taking into account the DA at prevailing rate (125 percent of basic pay), the salary/pension of all government employees/pensioners will be raised by at least 14.29  percent as on 01.01.2016. The entry-level pay has been recommended to be raised to Rs 18,000 per month, from the current Rs 7,000, while the maximum pay, drawn by the Cabinet Secretary, has been fixed at Rs 2.5 lakh per month from the current Rs 90,000.

As far as starting salary of a freshly recruited Class I officer is concerned, it will be Rs 56,100 per month. Chiefs of regulatory bodies including SEBI and TRAI will now get a consolidated pay package of Rs 4.5 lakh per month, while their full-time members will get Rs 4 lakh each.

Rate of increment has been retained at 3 percent. This will benefit the employees in future on account of higher basic pay as the annual increments that they earn in future will be 2.57 times than at present.

The recommendation of "withholding of annual increments in the case of those employees who are not able to meet the benchmark either for MACP or a regular promotion within the first 20 years of their service" has been "accepted", the notification said.  The benchmark for performance appraisal for promotion and financial upgradation has also been enhanced to "very good" from "good" level.

Accepting the Pay Commission recommendation of maintaining existing formula and methodology for calculating Dearness Allowance, the government notification said, "The reference base for calculation of Dearness Allowance after coming into force of the revised Pay structure shall undergo change accordingly and will be linked to the average index as on January 1, 2016."