The 7th Pay Commission, in a laudable and delightful move, has decided to revise the allowances and special allowances of teachers, finance officers,  registrars and equivalent academic cadres in the central universities. This salary hike will ensure the dignity of academicians and will motivate researchers to explore the field of Education.

This move by the government will reportedly benefit around 30,000 teachers and staff of central universities and 5,500 to be deemed universities. While announcing the proposal, Union HRD Minister Prakash Javadekar has said that it will help attract and retain high-quality faculty.

Meanwhile, on January 28, 2019, the University Grants Commission (UGC), had ordered to enhance honorarium for Guest Faculty to Rs 1,500 per lecture subject to a maximum of Rs.50,000 per month. Notably, before this, they were getting an honorarium of minimum Rs. 1000 and maximum Rs. 25,000 a month.

Besides the academicians, the central government has also enhanced the fellowship of the PhD students and similar research personnel operating in the field of Science and Technology, effective from January 1, 2019. Notably, the increase in fellowship will directly benefit over 60,000 research fellows. Fellowship for the JRFs in the first two years of PhD has increased to Rs. 31,000 from Rs.25,000. Likewise, a Senior Fellow Researcher (SRF) will now avail Rs. 35,000 as stipend as compared to the previous Rs. 28,000. The decision for the UGC order, issued on the basis of the 7th Pay Commission recommendations, was taken in the recently-held 537th meeting.

What is the Interim Budget 2019?

What is the 7th Pay Commission?

  • The Government has set up the Pay Commission to determine the salaries of the government employees. Post India’s independence, 7 Pay Commissions have been formed for reviewing and recommending the remuneration of all of the government’s civil and military divisions.
  • Former Finance Minister, P Chidambaram, on 25 September 2013, announced that Prime Minister Manmohan Singh has approved the constitution of the 7th Pay Commission.
  • The 7th Pay Commission was reportedly supposed to be implemented from January 2016. However, it had to be delayed.
  • In May 2014, a group of retired government officials had challenged the inclusion of a senior IAS Officer in the three-member 7th Pay Commission in the Delhi High Court. They alleged that the inclusion would cause an inherent bias in the commission’s recommendations towards IAS officers.
  • On November 9, 2017, the government raised the maximum amount that a central government employee can borrow from the government to Rs 25 lakh for the new construction/purchase of new house/flat.
  • Notably, the employee can borrow up to 34 months of the basic pay to a maximum of Rs 25 lakh, or cost of the house/flat, or the amount according to repaying capacity, whichever is the least.

World Cancer Day 2019

Highlights of the Recommendations of the 7th Pay Commission

7th Pay Commission
A Pay Commission is created by the government and gives its recommendations regarding changes in the salary structure of its employees. Some of the key recommendations are presented below for your perusal:
  • The recommended minimum pay for a new government employee at an entry level is raised from Rs.7,000 to Rs. 18,000 per month. For a newly recruited  Class I Officer, the minimum salary is raised to Rs.56,100 per month.
  • The recommended maximum pay for government employees was increased to Rs.2.25 lakhs per month for Apex Scale and Rs. 2.5 lakhs per month for Cabinet Secretary and others working at the same level.
  • The 7th Pay Commission, bearing the Grade Pay Structure issues in mind, has recommended by a new pay matrix. Therefore, once the 7th Pay Commission is enforced, the status of a government employee will not be decided by Grade Pay but by the level in the new Pay Matrix.
  • The aforementioned new pay structure is recommended by the 7th Pay Commission has pre-existing levels with no new levels being introduced.
  • The Pay Commission recommends full pay and allowances to be granted to all the employees who are hospitalised due to Work-related Illness and Injury Leave (WRIIL).
  • The 7th Pay Commission recommends a uniform Fitment Factor to eliminate partiality and discrimination in the system. The Fitment Factor is 2.57 times and is uniform for all the employees. it is reportedly said to increase to 3.00 times. However, in contrast to the recommendations made by the 7th CPC, employees are presently demanding a hike of 3.68. This essentially increases the fitment factor by 3 times.
  • The Dearness Allowance witnessed a 2% hike, much to the relief of the government employees. This move is said to benefit over 50 lakh central government employees, and 55 lakh pensioners plus staff.  This hike occurred so as to relieve the central government employees who are generally the most affected by inflation. The raise shot up straight from to 7% from an earlier 5%.
  • The Pay Commission also suggested retaining the annual increment of 3% p.a.
  • One of the core aims of the 7th Pay Commission is to improve the quality of services offered by the government and focuses on individual performance. As per a Report, performance benchmarks of Modified Assured Career Progression(MACP) has been modified and altered to make it more strict. The Report further says that no annual increments should be given to employees not meeting the desired performance level. Also, no promotions will be given if MACP is low for the first 20 years in service.
  • The 7th Pay Commission recommends MSP (Military Service Pay) to be paid for Defence Personnel only. Notably, MSP is the compensation paid to people offering military services in India. Also, MSP will be payable for all ranks inclusive of Brigadiers and people at the same level.
  • The Cabinet has examined a total of 196 allowances which are currently present. It has, however, abolished 51 allowances, retaining 37 allowances.
  • The 7th Pay Commission aims at increasing the basic pay of government employees and has recommended for the House Rent Allowance  (HRA) to increase by 2.4%.
  • The Commission also states that HRA will increase to 27%, 18%, and 9% when DA crosses 50%. HRS will further increase and will be paid at 30%, 20%, and 10% when DA crosses 100%.
  • Besides the Personal Computer Advance and House Building Advance, the 7th Pay Commission has abolished all non-interest bearing advances. Notably, House Building Advance has been increased from Rs.7.5 lakhs to Rs.25 lakhs.
  • The Pay Commission has made some changes to Central Government Employees Group Insurance Scheme (CGEIGS). The recommended rates are:
Level of employee Present monthly deduction in Rupees Present insurance amount in Rupees Recommended monthly deduction in Rupees Recommended insurance amount in Rupees
10 and above Rs.120 Rs.1,20,000 Rs.5000 Rs.50,00,000
6 to 9 Rs.60 Rs.60,000 Rs.2500 Rs.25,00,000
1 to 5 Rs.30 Rs.30,000 Rs.1500 Rs.15,00,000
  • Health Insurance Scheme has been recommended for Central Government employees and pensioners. The Report also recommends cashless medical benefit for pensioners outside CGHS area.
  • The Commission suggests a revision in the current pension scheme to create a parity between existing pensioners and current retirees. The new pension will be calculated by placing the past pensioners on the new Pay Matrix system.
  • The Commission recommends gratuity ceiling to be increased from the current Rs.10 lakh to Rs.20 lakh. Also, they recommend that the ceiling on gratuity may be raised by 25% when the DA rises by 50%.
  • The Commission has recommended implementing a slab-based system for disability element instead of the current percentile based disability pension regime.

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The Interim Budget 2019 was recently announced by the Finance Minister Piyush Goyal, which turned out to be quite people-centric, benefitting especially the farmers and the middle class. It was earlier rumored that there would be crucial announcements made from the Modi government, fulfilling the demand from employees over hikes in wages. Yet, despite the tax rebates and other provisions, there was no announcement however from their end addressing demands of the central government employees.

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