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Friday, February 28, 2014

Release of additional installment of dearness allowance to Central Government employees and dearness relief to Pensioners, due from 1.1.2014

The Union Cabinet today approved the proposal to release an additional installment of Dearness Allowance (DA) to Central Government employees and Dearness Relief (DR) to pensioners with effect from 01.01.2014, in cash, but not before the disbursement of the salary for the month of March 2014 at the rate of 10 percent increase over the existing rate of 90 percent. 

Hence, Central Government employees as well as pensioners are entitled for DA/DR at the rate of 100 percent of the basic with effect from 01.01.2014. The increase is in accordance with the accepted formula based on the recommendations of the 6th Central Pay Commission.

The combined impact on the exchequer on account of both dearness allowance and dearness relief would be Rs. 11074.80 crore per annum and Rs. 12920.60 crore in the financial year 2014-15 ( i.e. for a period of 14 months from January 2014 to February 2015).
 

7th Central Pay Commission

The Union Cabinet today gave its approval to the Terms of Reference of 7thCentral Pay Commission (CPC) as follows:-

a) To examine, review, evolve and recommend changes that are desirable and feasible regarding the principles that should govern the emoluments structure including pay, allowances and other facilities/benefits, in cash or kind, having regard to rationalization and simplification therein as well as the specialized needs of various Departments, agencies and services, in respect of the following categories of employees:-

i. Central Government employees-industrial and non-industrial;

ii. Personnel belonging to the All India Services;

iii. Personnel of the Union Territories;

iv. Officers and employees of the Indian Audit and Accounts Department;

v. Members of regulatory bodies (excluding the Reserve Bank of India) set up under Acts of Parliament; and

vi. Officers and employees of the Supreme Court.

b) To examine, review, evolve and recommend changes that are desirable and   feasible regarding principles that should govern the emoluments structure, concessions and facilities/benefits, in cash or kind, as well as retirement benefits of personnel belonging to the Defence Forces, having regard to historical and traditional parities, with due emphasis on aspects unique to these personnel.

c) To work out the framework for an emoluments structure linked with the need to attract the most suitable talent to Government service, promote efficiency, accountability and responsibility in the work culture, and foster excellence in the public governance system to respond to complex challenges of modern administration and rapid political, social, economic and technological changes, with due regard to expectations of stakeholders, and to recommend appropriate training and capacity building through a competency based framework.

d) To examine the existing schemes of payment of bonus, keeping in view, among other things, its bearing upon performance and productivity and make recommendations on the general principles, financial parameters and conditions for an appropriate incentive scheme to reward excellence in productivity, performance and integrity.

e) To review the variety of existing allowances presently available to employees in addition to pay and suggest their rationalization and simplification, with a view to ensuring that the pay structure is so designed as to take these into account.

f) To examine the principles which should govern the structure of pension and other retirement benefits, including revision of pension in the case of employees who have retired prior to the date of effect of these recommendations, keeping in view that retirement benefits of all Central Government employees appointed on and after 01.01.2004 are covered by the New Pension Scheme (NPS).

g) To make recommendations on the above, keeping in view:

i.    the economic conditions in the country and need for fiscal prudence;

ii. the need to ensure that adequate resources are available for    developmental expenditures and welfare measures;

iii.   the likely impact of the recommendations on the finances of the State Governments, which usually adopt the recommendations with some modifications;

iv.  the prevailing emolument structure and retirement benefits available to employees of Central Public Sector Undertakings; and

v.   the best global practices and their adaptability and relevance in Indian conditions.

h) To recommend the date of effect of its recommendations on all the above.

The Commission will make its recommendations within 18 months of the date of its constitution. It may consider, if necessary, sending interim reports on any of the matters as and when the recommendations are finalised.

The decision will result in the benefit of improved pay and allowances as well as rationalization of the pay structure in case of Central Government employees and other employees included in the scope of the 7th Central Pay Commission.

Background

Central Pay Commissions are periodically constituted to go into various issues of emoluments’ structure, retirement benefits and other service conditions of Central Government employees and to make recommendations on the changes required.
 

Proposals of Enhancement of Retirement age and Merger of D.A may not materialize

It was learnt from the sources close to the Union Government that the proposals of Enhancement of Retirement age of Central Government Employees from 60 to 62 years and Merger of D.A to basic pay may not be materialized now before General elections. Accordingly, these two proposals have not been taken up for consideration by the union Cabinet in its meeting held on friday. But there is possibility to announce Interim Relief (I.R) before elections. 
 

Expected Pay in 7th CPC

EXPECTED PAY STRUCTURE OF 7TH CPC : -
6th CPC PAY STRUCTURE
EXPECTED PAY STRUCTURE OF 7TH CPC
Pay Band
Pay Bands
Grade Pay
Pay in the Pay Band
Pay Scale
Pay Band
Grade Pay
Pay in the Pay Band
Pay Scale
PB-1
5200-20200
1800
5200
7000
15000-60000
5000
15000
20000
PB-1
5200-20200
1900
5830
7730
15000-60000
5500
17000
22500
PB-1
5200-20200
2000
6460
8460
15000-60000
6500
20000
26500
PB-1
5200-20200
2400
7510
9910
15000-60000
7500
23000
30500
PB-1
5200-20200
2800
8560
11360
15000-60000
8500
26000
34500
PB-2
9300-34800
4200
9300
13500
30000-100000
10000
30000
40000
PB-2
9300-34800
4600
12540
17140
30000-100000
13500
35000
48500
PB-2
9300-34800
4800
13350
18150
30000-100000
15000
40000
55000
PB-3
15600-39100
5400
15600
21000
50000-150000
16500
50000
66500
PB-3
15600-39100
6600
18750
25530
50000-150000
20000
60000
80000
PB-3
15600-39100
7600
21900
29500
50000-150000
23000
70000
93000
PB-4
37400-67000
8700
37400
46100
100000-200000
26000
100000
126000
PB-4
37400-67000
8900
40200
49100
100000-200000
27500
110000
137500
PB-4
37400-67000
10000
43000
53000
100000-200000
30000
120000
150000