7th Pay Commission: All you need to know about recommendations for Central govt employees

The Narendra Modi government set up the Seventh Pay Commission to recommend changes in the salary structure of Central government employees, and currently, it has implemented the Seventh Pay Commission.

Here are the details about the Seventh Pay Commission recommendations:

Recommended minimum pay for govt employees

The minimum pay of an entry-level government employee is increased from Rs 7,000 to Rs 18,000 per month. For an entry-level Class I officer, the minimum salary is increased to Rs 56,100 per month.

Recommended maximum pay for govt employees

The Seventh Pay Commission also recommends increasing the maximum pay for government employees to Rs 2.25 lakh per month for Apex Scale and Rs 2.5 lakh per month for Cabinet Secretary-level officers.

Pay Matrix

The status of a government employee will not be decided by Grade Pay but by the level in the new Pay Matrix.

New Pay Structure

The New Pay Structure recommended by the Seventh Pay Commission have included all existing levels and have not introduced any new levels.

Work-related illness and injury leave (WRIIL)

The Seventh Pay Commission has recommended full pay and allowances to be granted to all employees who have been hospitalised due to work related illness and injury.

Fitment

The Seventh Pay Commission has recommended a uniform Fitment Factor of 2.57 for all employees.

Annual increment: The Seventh Pay Commission has suggested to retain the annual increment of 3 percent per annum.

Modified assured career progression

The Seventh Pay Commission aims at improving the quality of services offered by the government and thereby focuses on individual performance. According to media reports, performance benchmarks of MACP has been altered and made stricter. They have made the performance indicator stricter by adding “very good” performance level which was “good” before. The report goes on to recommend that no annual increments should be given to employees who do not meet their performance level and no promotions will be given if MACP is low for the first 20 years in service.

Military Service Pay

The commission recommends MSP to be paid for defence personnel only. MSP is the compensation paid to people offering military service in India. MSP will be payable for all ranks inclusive of Brigadiers and people at the same level.

Allowances 

The Cabinet after examining 196 allowances, which are currently present, abolished 51 allowances and retained only 37 allowances.

House Rent Allowance

The Seventh Pay Commission has recommended that the House Rent Allowance increase of 24 percent HRA will increase to 27 percent, 18 percent, and 9 percent when DA (dearness allowance) crosses 50 percent. HRS will further increase and will be paid at 30 percent, 20 percent, and 10 percent when DA crosses 100 percent.

Advances

Apart from personal computer advance and house building advance, the Commission has abolished all non-interest bearing advances. House building advance has been increased from Rs 7.5 lakh to Rs 25 lakh.

Group Insurance Scheme

The Seventh Pay Commission has made some changes to the Central government employees group insurance scheme. 

Medical Changes

The Seventh Pay Commission recommended a Health Insurance Scheme for Central government employees and pensioners; and cashless medical benefit for pensioners outside CGHS area.

Pension

The Seventh Pay Commission recommends a revised pension formulation for civil employees including CAPF and defence personnel who have retired before 01.01.2016. The new formulation will focus on bringing parity between existing pensioners and current retirees.

The new pension will be calculated by placing the past pensioners on the new Pay Matrix system. Later, the pension amount will be arrived at by adding the number of increments a pensioner has earned in that level while in active service at the rate of 3 percent p.a. and, 50 percent of the so arrived amount will be the new pension. A pensioner will get a multiple of 2.57 times the current basic pension.

Gratuity

The Seventh Pay Commission recommends the ceiling of gratuity to be increased from the current Rs 10 lakh to Rs 20 lakh. They further recommend that the ceiling on gratuity may be raised by 25 percent when the DA rises by 50 percent.

Disability Pension for Armed Forces

Instead of the current percentile based disability pension regime, the Seventh Pay Commission has recommended to implement a slab-based system for disability element.