7th Pay Commission: Know the key recommendations cleared by Cabinet

Know the key recommendations cleared by Cabinet on 7th Pay Commission.

7th Pay Commission: Know the key recommendations cleared by Cabinet

Zee Media Bureau

New Delhi: The Union Cabinet on Wednesday cleared the report of the Committee of Secretaries headed by Cabinet Secretary P K Sinha on the recommendations of the Seventh Pay Commission.

The government had in January set up a high-powered panel headed by Cabinet Secretary to process the recommendations of the 7th Pay Commission which will have bearing on the remuneration of nearly 50 lakh central government employees and 58 lakh pensioners.


Here's a quick look at the 7th Pay Commission recommendations and the likely implications:

-The Union Cabinet approved 23.55 percent overall hike in salaries, allowances and pension involving an additional burden of Rs 1.02 lakh crore or nearly 0.7 percent of the GDP.

-Average salary hike includes 14.27 percent increase in basic pay, the lowest in 70 years. The previous 6th Pay Commission had recommended a 20 percent hike which the government doubled while implementing it in 2008.

-Recommendations to be implemented from January 1, 2016

-Minimum pay fixed at Rs 18,000 per month; maximum pay at Rs 2.25 lakh

-The rate of annual increment retained at 3 percent

-24 percent hike in pensions


-The Commission recommends abolishing 52 allowances; another 36 allowances subsumed in existing allowances or in newly proposed allowances

-Recommendations will impact 47 lakh serving govt employees, 52 lakh pensioners, including defence personnel

-One Rank One Pension proposed for civilian government employees on line of OROP for armed forces

-Ceiling of gratuity enhanced from Rs 10 lakh to Rs 20 lakh; ceiling on gratuity to be raised by 25 percent whenever DA rises by 50 percent


-Cabinet Secretary to get Rs 2.5 lakh as against Rs 90,000 per month pay band currently

-Financial impact of implementing recommendations in toto will be Rs 1.02 lakh crore - Rs 73,650 crore to be borne by Central Budget and Rs 28,450 crore by Railway Budget

-Total impact of Commission's recommendation to raise the ratio of expenditure on salary and wages to GDP by 0.65 percentage points to 0.7 percent


-Military Service Pay (MSP), which is a compensation for the various aspects of military service, will be admissible to the defence forces personnel only

-MSP for service officers more than doubled to Rs 15,500 per month from Rs 6,000 currently; for nursing officers to Rs 10,800 from Rs 4,200; for JCO/ORs to Rs 5,200 from Rs 2,000 and for non-combatants to Rs 3,600 from Rs 1,000


-Short service commissioned officers will be allowed to exit the armed forces at any point in time between 7 to 10 years of service