No indication of percentile increase in HRA, transport allowances

According to sources, the committee examining the suggestions of the 7th Pay Commission on allowances, is unlikely to make changes of percentage in house rent allowance (HRA).

The committee, headed by Finance Secretary Ashok Lavasa to examine the suggestions of the 7th Pay Commission on allowances, is working to make the new allowances structure keeping in mind the inflation. According to sources, the committee examining the suggestions of the 7th Pay Commission on allowances, is unlikely to make changes of percentage in house rent allowance (HRA). The committee will consider the high cost of housing rent in cities and charges of medical and other facilities before submitting its report on suggestions of the 7th Pay Commission on allowances structure.

According to the sources in the Finance Ministry, issues like inflation, the government’s financial position and new salary structure of central government employees would be examined before submitting the report on new allowances. The committee won’t make any change in the existing house rent allowance (HRA) percentage. (ALSO READ: 7th Pay Commission: NJCA to pitch for 3.68 fitment factor to revise minimum pay in meeting with National Anomaly Committee)

It means, central government employees living in ‘X’ class cities like Ahmedabad, Bangalore, Chennai, Delhi, Hyderabad, Kolkata, Mumbai and Pune, will get 30 percent of their pay matrix as house rent allowance (HRA), no increasing from the existing 30 percent, reported the Sen Times. Employees posted at ‘Y’ class cities covers near about 90 stations, will receive 20 percent of pay matrix, at the existing percentage. The HRA in ‘Z’ class cities will be 10 per cent.

The 7th Pay Commission had proposed the rate of House Rent Allowance (HRA) at 24 percent, 16 percent and 8 percent of the Basic Pay for Class X, Y and Z cities respectively. The committee will not propose to increase the rate of transport allowances of central government employees and it will be as per the recommendations of the 7th Pay Commission, said sources.

The government formed a committee headed by Finance Secretary Ashok Lavasa and Secretaries of Home Affairs, Defence, Health and Family Welfare among others as its members on July 22 for examination of the recommendations of 7th Pay Commission on allowances. The 7th Pay Commission headed by Justice A K Mathur had recommended abolition of 51 allowances and subsuming 37 others after examining 196 allowances. The committee is likely to submit its report by September and from October government employees are likely to get their revised allowances.

The government in July issued the notification for the implementation of the 7th Pay Commission recommendations. The 7th Pay Commission notification confirmed that central government employees 14.27 per cent hike in basic pay at junior levels, the lowest in 70 years. The Cabinet also approved the increase in minimum pay Rs 18,000 from existing Rs 7,000. Many government employees are unhappy as the requested minimum wage was increased to Rs 18,000 and the demand was made of Rs 26,000. More than 47 lakh Central Government employees and 53 lakh pensioners have been eagerly waiting for implementation of 7th Pay Commission.

Gratuity to all NPS Employees

No. 7/5/2012-P&PW(F)/B
Ministry of Personnel, Public (Grievances and Pensions
Department of Pension and Pensioners Welfare

Lok Nayak Bhawan, Khan Market,
New Delhi-110 003, Dated the 26th August, 2016

OFFICE MEMORANDUM

Subject: Extension of benefit of Retirement Gratuity and Death Gratuity to the Central Government Employees covered by new Defined Contribution Pension System (National Pension System) – regarding.

The undersigned is directed to say that the pension of the Government servants appointed on or after 1.1.2004 is regulated by the new Defined Contribution Pension System (known as National Pension System), notified by the Ministry of Finance (Department of Economic Affairs) vide their O.M. No. 5/7/2003-ECB & PR dated 22.12.2003. Orders were issued for payment of gratuity on provisional basis in respect of employees covered under National Pension System on their retirement from Government service on invalidation or death in service, vide this Department’s O.M. No. 38/41/2006-P&PW(A) dated 5.5.2009.

2. The issue of grant of gratuity in respect of government employees covered by the National Pension System has been under consideration of the Government. It has been decided that the government employees covered by National Pension System shall be eligible for benefit of ‘Retirement gratuity and Death gratuity’ on the same terms and conditions, as are applicable to employees covered by Central Civil Service (Pension) Rulke,1972.

3. These orders issue with the concurrence of Ministry of Finance, Department of Expenditure, vide their .D. Note No. 1(4)/EV/2006-II dated 29.07.2016.

4. In their application to the persons belonging to the India Audit and Accounts Department, these orders issue after consultation with Comptroller and Auditor General of India.

5. These orders will be applicable to those Central Civil Government Employees who joined Government Service on or after 1.1.2004 and are covered by National Pension System and will take effect from the same date i.e. 1.1.2004.

Sd/-
(Harjit Singh)
Director (Pension Policy)

NEITHER TRANSPORT NOR TPT ALLOWANCE TO OFFICER WITH NFU GRADE PAY

Clarification on admissibility of Transport Allowance in the eases where the officers are drawing Grade Pay of Rs.10,000/- in PB-4

No. 21(2)/2016-E.II(B)
Government of India Ministry of Finance
Department of Expenditure

New Delhi, 19th August, 2016.

OFFICE MEMORANDUM

Subject:- Clarification on admissibility of Transport Allowance in the eases where the officers are drawing Grade Pay of Rs.10,000/- in PB-4 – regarding.

Reference is invited to this Department’s Office Memorandum No.21(2)/2008-E.11(B) dated 29.08.2008. Para `3′ of the O.M. stipulates that Officers drawing Grade Pay of Rs.10,000/- & above and those in the HAG+ Scale, who are entitled to the use of official car in terms of Department of Expenditure (DoE) O.M. No. 20(5)/E.II(A)/93 dated 28.01.1994, shall be given the option to avail themselves of the existing facility or to draw the Transport Allowance at the rate of Rs.7,000/- p.m. plus Dearness Allowance thereon.

2. Several references have been received in this Department seeking clarification on the admissibility of Transport Allowance to officers drawing Grade Pay Rs.10,000/- under Dynamic ACP Scheme or NFU Scheme. A few cases have also been filed in the Courts in this regard. Hon’ble Central Administrative Tribunal (CAT), Principal Bench, New Delhi, in Order dated 13.05.2014 in U.A. No.4062/2013 filed by Shri Radhacharan Shakiya & Others V/s Union of India & Others, held that the Applicants were not entitled to draw Transport Allowance @ Rs.7,000/- pm. plus DA thereon. The said order of the Tribunal has also been upheld by Hon’ble High Court of Delhi in their Order dated 03.09.2014 passed in Writ Petition (Civil) No. 3445/2014, filed by Shri Radhacharan Shakiya & Others,

3. Accordingly, it is clarified that the officers, who are not entitled for the use of official car for commuting between residence to office and back, in terms of DoE’s OM 20(5)/E-II(A)193 dated 28.01.1994, are not eligible to opt for drawal of Transport Allowance @ Rs.7000/- p.m. + DA thereon, in terms of DoE O.M. No.21(2)/2008-E.II(B) dated 29.08.2008, even though they are drawing Grade Pay of Rs.10,000/- in PB-4 under Dynamic ACP Scheme or under the scheme of Non-Functional Upgradation (NFU).

sd/-
(Nirmala Dev)
Deputy Secretary to the Govt. of India

Source : finmin.nic.in

7th Pay Commission Allowances From October

The new allowances for the central government employees is likely to be implemented from October 1, a senior Finance Ministry official told The Sen Times today on condition of anonymity

“Definitely, the new allowances on recommendations of 7th Pay Commission will be made effective soon. However, if its implementation is delayed it will be given effect from October 1,” the official told our reporter.

The finance ministry official said the Finance Secretary committee will submit its report by September end.

The official said alongside main allowances, the Finance Secretary committee will recommend various reforms in allowances hence it will take some time to implement those after scrutinising.

The Union Cabinet cleared the recommendations of 7th Pay Commission in respect of the hike in basic pay and pension on June 29 but decision on its suggestions relating to allowances has been referred to a Committee headed by Finance Secretary.

Accordingly, notification and resolution for the implementation of the 7th Pay Commission recommendations in respect of the hike in basic pay were issued on July 25.

The pay fixation and arrears  related  Office Memorandum No.1-5/2016-IC and Corrigendum dated July 29 and dated August 1 respectively were issued for paying arrears in one go in August salary.

According to Union Cabinet decision, a Committee headed by Finance Secretary Ashok Lavasa and Secretaries of Home Affairs, Defence, Health and Family Welfare among others as its members was constituted on July 22 for examination of the recommendations of 7th Pay Commission on allowances other than dearness allowance.

The pay commission headed by Justice A K Mathur had recommended abolition of 51 allowances and subsuming 37 others after examining 196 allowances.

The scrapping of the allowances was opposed by the central government employees’ Unions and so it has been referred to a Committee of Secretaries.

Finance Minister Arun Jaitley said in Rajya Sabha in this month, “These measures are radical in nature, even the employees’ unions have given their suggestions in the matter and therefore the committee has been formed to look into allowances. Whatever the committee decides, it will go to the Cabinet.”

The first meeting of the Finance Secretary Committee on allowances already took place on August 4.

The once in a decade pay hike has seen burden on exchequer rise from Rs 17,000 crore in the 5th Pay Commission to Rs 40,000 crore in the 6th and Rs 1,02,100 crore in the 7th Pay Commission, Jaitley  earlier said.

“The Union government needs funds. The Pay Commission has put a burden of Rs 1.03 lakh crore,” Jaitley said in the Parliament in this month.

The hike in the salary component as recommended by the 7th Pay Commission was accepted with retrospective effect from January 1, 2016. The arrears will be paid to the Central government employees and pensioners on August 31, Jaitley added.

It is noted that no arrears for allowances will be paid, as per usual practice, the allowances would be paid from the date of implementation.

The recommendations of the 7th Pay Commission cover 48 lakh Central government employees and 52 lakh pensioners.

Two 'Anomaly Committee' for implementation of 7th pay commission

The centre on Wednesday announced setting up of an 'Anomaly Committee' to settle issues arising out of the implementation of the Seventh Pay Commission's recommendations from August 1.

This announcement came following concerns by unions of employees over the delay in setting up the high level committee, assured by the Group of Ministers to review the minimum wage and multiplication factor as well as anomalies which have crept in following implementation of the new Pay Commission recommendations.

A notification issued by the Department of Personnel said here that Anomaly Committee would consist of representatives of the official side and the staff side. It also said that the Committee would be guided by specified conditions.

It said that definition of Anomaly will include where the official side and the staff side are of the opinion that any recommendation is in contravention of the principle or the policy enunciated by the Seventh Central Pay Commission itself without the Commission assigning any reason.

As per the notification there will be two levels of Anomaly Committees — National and Departmental, consisting of representatives of the Official Side and the Staff Side of the National Council and the Departmental Council respectively.

The National Anomaly Committee will deal with anomalies common to two or more Departments and in respect of common categories of employees. The Departmental Anomaly Committee will deal with anomalies exclusive to the Department concerned and having no repercussions on the employees of another Ministry/Department.

The Anomaly Committee shall receive anomalies through Secretary, the staff side of respective Council up to six months from the date of its constitution and it will finally dispose of all the anomalies within a period of one year from the date of its constitution. Any recommendations of the Anomaly Committee to resolve the anomaly shall be subject to the approval of the Government.

Cases where there is a dispute about the definition of "anomaly" and those where there is a disagreement between the staff side and the official side on the anomaly will be referred to and "arbitrator" to be appointed out of a panel of names proposed by the two sides. However, this arbitration will not be a part of the JCM Scheme.

On August 12 the National Joint Council of Action (NJCA) in a communication to all its constituents had said that it has asked the Cabinet Secretary to hold a Special discussion with on the issue.

It had said its representatives have conveyed strong `resentment’ over decision to allow the first option given to the pensioners be implemented subject to feasibility.

“We have reiterated that while we are open to discussion as to the methodology of verification of the claims of individual petitions in respect of Option No.l, we would not be able to countenance of the non implementation of the recommendation of the 7th CPC on the flimsy ground of non availability of records”.

It also had asked the Constituents Organisations to forward the various anomalies on the implementation of the Seventh CPC notification within in 15 days.

No New Pay Commission In Future

The government is mulling not to form new Pay Commission for increasing salaries and allowances of central government employees and and pensioners in future.

There would be an officer who would submit a report of inflation to the Finance Minister Arun Jaitley every three years.
There would be an officer who would submit a report of inflation to the Finance Minister Arun Jaitley every three years.

No new commission may be formed in future for increasing salaries of central government employees, a senior Finance Ministry official told The Sen Times on condition of anonymity.

“The government is going to take a policy decision in this regard,” official told our reporters after issuing the 7th Pay Commission notification.

Pay Commissions makes much impact on the fiscal deficit, since pay commission awards come once in 10 years, the two to three years subsequent to each award tend to be fiscally stressful for the central government. States also suffered major blows to their finances for implementation of pay commission report, he added.

Presenting an idea about an alternative arrangement, he said that the 7th Pay Commission Chairman Justice A K Mathur had earlier told The Financial Express in an interview, “The government should review the salary of central government employees every year looking into the data available to it and based on the price index.”

The 7th Pay Commission recommended that the pay matrix may be reviewed periodically without waiting for the long period of ten years. It can be reviewed and revised on the basis of the Aykroyd formula which takes into consideration the changes prices of the commodities that constitute a common man’s basket, which the Labour Bureau at Shimla reviews periodically.

The Pay Commission also suggested that this should be made the basis for revision of that pay matrix periodically without waiting for another Pay Commission.

So, it will not be necessary to form a new pay Commission after every 10 years for central government employees and pensioners and whether any change is required regarding pay and allowances would be made considering inflation.

Accordingly, the central government is to follow this proposal of the Pay Commission and to discontinue the practice of appointing pay commissions in future to suggest salary structure and other perks for all central government employees and pensioners, the official gave his views.

The official said there would be an officer who would submit a report of inflation to the Finance Minister Arun Jaitley every three years.

He added some changes regarding pay and allowance would be made considering inflation.

Special committee of allowances constituted on 22 July headed by the finance secretary as chairman

The Union cabinet will take a decision on the suggestions of a special committee, which has been set up to look into the provision of allowances under the Seventh Central Pay Commission recommendations, finance minister Arun Jaitley said on Tuesday.

Replying to a question on the pay commission in Rajya Sabha, the minister said the government has decided that the recommendations on allowances for central government employees, other than dearness allowance, will be examined by a committee headed by the finance secretary as chairman, and secretaries of home affairs, defence, health and family welfare among others as its members.

The committee, which was constituted on 22 July, has been asked to submit its report within four months. Its first meeting took place on 4 August. “As far as allowances are concerned, 51 have been abolished while 37 have been subsumed. As the measures are radical in nature, even the employees’ unions have given their suggestions in the matter and therefore a special committee has been formed to look into it. Whatever the committee decides, it will go to the cabinet,” Jaitley said.

The matters relating to pay and pension as decided by the government have been implemented with effect from 1 January this year.