Big bonanza for central govt employees: 7th Pay Commission proposes 23.55% hike in salary

A 23.55 percent hike in salary, allowances and pension involving an additional burden of Rs 1.02 lakh crore has been recommended to central government employees and pensioners by the 7th Pay Commission which more than doubled the entry and top level pay while favouring a virtual OROP for civilians.

The recommendations that will benefit 47 lakh central government employees and 52 lakh pensioners, which will impact the Central Budget by Rs 73,650 crore and the Railway Budget by Rs 28,450 crore.

The 900-page report of the 7th Pay Commission headed by Justice A K Mathur was presented to Finance Minister Arun Jaitley with a recommendation that the new scales be implemented from January 1 next year.

The panel recommended a 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. The 23.55 percent increase includes hike in allowances.

The entry level pay has been recommended to be raised to Rs 18,000 per month from current Rs 7,000 while the maximum pay, drawn by the Cabinet Secretary, has been fixed at Rs 2.5 lakh per month from current Rs 90,000. For the Secretaries it has been fixed at Rs 2.25 lakh as against Rs 80,000 currently.