Seventh Pay Commission to offer realistic view on salaries and allowances

Seventh Pay Commission to offer realistic view on salaries and allowances

The Sixth pay commission was constituted in 2006 and in the normal course, the government was expected to announce the next pay commission after a gap of 10 years. The fifth came in 1996. But with the UPA government’s image battered by a spate of corruption scandals, the date had been advanced by two years in order to recover some lost ground with the electorate.

The UPA government justified the early constitution of the commission on the ground that it will take around two years to submit its recommendations. The Sixth pay commission, for example, was constituted in October 2006 and the Centre implemented it ahead of the 2009 Lok Sabha elections, showering central government employees with a big pay hike bonanza.

The Sixth pay commission had recommended a 20 to 40 per cent jump in salary. This cheered the employees, but wreaked havoc with the government’s finances as the fiscal deficit soared to 6 per cent of the gross domestic product (GDP). The consequent burden of arrears on the central government was Rs 28,160 crore on a salary base of Rs 44,360 crore.

The cash-strapped government had disbursed the arrears in two instalments with 40 per cent given out in 2008-09 and 60 per cent in 2009-10. The arrears contributed significantly to the Centre overshooting its target in 2008-09, ending the year with a fiscal deficit of 6 per cent of GDP against the budgeted 2.5 per cent.

The fiscal deficit rose to 6.4 per cent of GDP in 2009-10 as pay commission arrears pushed up the expenditure at a time when the government was battling slowdown in revenues. With the Seventh pay commission, the situation is headed in the same direction and the country will eventually have to face the music of this populism.

Accordingly, the Seventh Pay Commission is likely to offer realistic view on increase of salaries and allowances of central government employees.
The pay panel may definitely bring also toll on the exchequer as government has to manage expenditures of One Rank One Pension (OROP) for ex-sevicemen before Seventh pay commission expenditures.
It is expected that the central government’s salary bill will rise by 9.56% to Rs 1,00,619 crore after Seventh pay commission will come into effect.
This OROP announcement will have a significant impact on Seventh pay commission report badly, especially in salary hike and increasing allowances,” said a pay panel official.

“We have to look financial health of government before submitting our report. We have to save financial position of government to run the nation smoothly. We are not only to work for pay hike.” he added.

However, the recommendations of Seventh Pay Commission, may be implemented by NDA government before the announcement of West Bengal, Assam, Kerala and Tamil Nadu states assemblies’ election in May 2016.

“The central government will decide execution time of the pay commission’s proposals after the pay panel submits its report, which will be possible pre-election “special packages” for West Bengal, Assam, Kerala and Tamil Nadu, which are all due for polls by May 2016,” an official of the Finance Ministry said, speaking on condition of anonymity.

The Seventh Pay Commission is likely to submit its report in December. The Commission has already completed discussions with various stakeholders, including organisations, federations, groups representing civil employees as well as Defence services and is in the process of finalising its recommendations.
The recommendations of the Seventh Pay Commission are scheduled to come into effect from January 1, 2016.

TST

Good news expected soon: Update on Bonus Hike

Good news expected soon: Update on Bonus Hike

As per reliable sources, Election Commission has given it’s nod for issuing ordinance on “Payment of Bonus Act”

Now the matter will go to cabinet and after it’s approval, necessary ordinance will be notified soon.
Earlier Government decided to raise the ceiling of Rs 3500/- per month to Rs 10,000/- per month.

Central employees may cheer for higher bonus this year

After long times Central Government Employees are going to get higher amount of bonus this year. Earlier, the ceiling for bonus was Rs 3500 per month. From this year, the ceiling is going to be increased to as high as Rs 10,000 per month. In a letter from Secretary, Ministry of Labour and Employment, Mr S. Agarwal conveyed this good news to Sri Vijesh Upadhyay, Genl. Secy., Bharatiya Mazdoor Sangha.



Source: http://paycommissionupdate.blogspot.in

Streamlining Action on Pension grievances-uploading of replies given by the Ministries/Departments to the petitioner on CPENGRAMS

Streamlining Action on Pension grievances-uploading of replies given by the Ministries/Departments to the petitioner on CPENGRAMS

No. 55/6/2015-P&PW(C)

Government of India

Ministry of Personnel, P.G. & Pensions

Department of Pension & Pensioners’ Welfare

3rd Floor, Lok Nayak Bhawan, New Delhi,

the 29th September, 2015

OFFICE MEMORANDUM

Subject: Streamlining Action on Pension grievances-uploading of replies given by the Ministries/Departments to the petitioner on CPENGRAMS.

It has been observed that in most of the cases of pension related grievance, the Ministries/Departments/Organizations do not upload the replies to the petitioner on the portal and close the cases. It is therefore requested that in case, any letter or orders etc, are issued by the concerned Ministry/Department/Organization for redress of the grievance or for not acceding the request of the petitioner for valid reasons, the same may also be uploaded on the portal CPENGRAMS.

It is again reiterated that since effective grievance redress mechanism is a priority of the Government, the quality of disposal is important and a well reasoned speaking reply should be furnished to the petitioner before closure of grievance an a copy of the same be uploaded on CPENGRAMS,

(Seema Gupta)

Deputy Secretary to the Government of India

Source: Pensioners Portal
[http://ccis.nic.in/WriteReadData/CircularPortal/D3/D03ppw/ppwc_290915.pdf]

HOUSE BUILDING ADVANCE for Central Government Employees

HOUSE BUILDING ADVANCE

  

Housing Loan for Central Government Employees…

General Rules for HBA :-
The advance granted to all permanent Central Government Employees.
The advance granted, who has completed minimum 10 years continuous service.
The advance granted for construction / purchase of house / plot.
The advance granted for purchase of ready-built house / flats.
The advance granted for buying a plot or flat under Co-operative Schemes.
The advance granted for enlarging existing accommodation.
The advance granted for purchase of houses / flats under Self Financing Housing Schemes and Co-operative Group Housing Schemes.
 
General Conditions for HBA :-
Employees should not have availed of any loan or advance for the purpose from any other Government sources.

Employee or spouse or minor child should not already own a house.

Cost Ceiling :-
Cost of the house (excluding cost of the land) should not exceed 134 times of the Basic Pay, subject to a minimum of Rs.7.5 lakhs and a maximum of Rs.18 lakhs. (If both husband and wife are working central government services, the pay of both of them will be taken into consideration for calculating the cost ceiling).

Sanction Amount :-
The amount of House Building Advance admisssiable for employees is 34 times of the Basic Pay or Rs.7.5 lakhs or cost of the building or repaying capacity, whichever is least.

RATE OF INTEREST :-
(Note: No interest is chargeable beyond the date of retirement / death of the Government Servant.)

HBA sanctioned amount	26-7-90 to 15-12-97	16-12-97 to 31-3-2001	1-4-2001 to 31-3-2002	1-4-2002 onwards
Rs. 25,000/-	7.5%	7.5%	6.5%	6%
Rs. 50,000/-	7.5%	7.5%	6.5%	6%
Rs. 75,000/-	9%	9%	8%	7.5%
Rs. 1,00,000/-	9%	9%	8%	7.5%
Rs. 1,25,000/-	10%	9%	8%	7.5%
Rs. 1,50,000/-	10%	9%	8%	7.5%
Rs. 2,00,000/-	11%	11%	10%	9.5%
Rs. 2,25,000/-	11.5%	11%	10%	9.5%
Rs. 2,50,000/-	12%	11%	10%	9.5%
Rs. 5,00,000/-	….	11%	10%	9.5%
Rs. 7,50,000/-	….	12%	11%	10.5%

(Note: The advances carry interest from the date of payment of the first installment and is calculated on the balance outstanding on the last day of each month.)

Income Tax Rebate for HBA :-
Repayment of Principal sum of H.B.A. is exempt u/s 88 of Income Tax Act.
Exemption for Interest portion of HBA is admissible up to maximum of Rs. 1,50,000/-.
If any individual has drawn House Building Loan from any other financial institution, at the end of the year he should obtain a certificate from that financial institution showing repayment of loan details. In that repayment of Principal sum and Interest portion should be clearly mentioned. Accordingly income tax rebate can be taken on principal sum and interest sum.
Interest is calculated on the balance of HBA outstanding on the last day of the month i.e. on the IBB just like calculation of interest on advance for purchase of conveyance, etc.
Interest on H.B.A. is exempt u/s 24(b) of Income Tax Act.


Family Planning Concession for HBA: –
Concessional interest to Central Government Employees for promoting Small Family Norms. – The rate of interest will be half per cent less for an employee who undergoes sterlization.

OROP: Why ex-servicemen continue to protest

OROP: Why ex-servicemen continue to protest

The definition of OROP accepted by the government in Parliament has equal pension for officers retiring in the same rank with equal length of service.

The Centre has informed the Supreme Court that it has complied with a 2008 judgment regarding the implementation of the One Rank One Pension (OROP) on Tuesday, but almost three weeks after the government announced an OROP roll out, the ex-servicemen’s agitation at Jantar Mantar is far from dying down. The ex servicemen claim that the government-announced scheme is anything but OROP.

The definition of OROP accepted by the government in Parliament has equal pension for officers retiring in the same rank with equal length of service. In his September 5 announcement, the Defence Minister Manohar Parrikar said that OROP would be implemented with retrospective effect from July 2014 and with 2013 as the base year. What this essentially meant was that that the veterans’ pensions shall match the pensions of those retiring in 2013 and that they would be given the arrears from July 2014.

The government also announced a one-member judicial committee to address the likely anomalies in the scheme. Most importantly, the scheme, written order of which is slated to be rolled out within a month, will involve revision of pensions every five years.

The government’s interpretation of OROP is unacceptable to the ex- servicemen community. They believe that each of these clauses is a violation of the basic definition of OROP as outlined by the Bhagat Singh Koshiyari Committee in 2012.

For instance, the five-year revision of pensions implies that a veteran’s pension will remain unchanged for five years. This will create multiple pensions for officers of one rank given that for five years – the gap between two revisions – many new retirees will leave the services with different pensions.

The ex-servicemen jokingly term the government’s five-year revision proposal as One Rank Many Pensions and still demand an annual revision.

Disagreement also continues over the judicial committee, as the ex- servicemen are seeking a five-member committee rather than the proposed one-man committee — with three of their own members, one representative from the government and one nominated member.

Last but not the least, there is a strong distrust of the bureaucracy. In fact, the government’s announcement to omit premature retirees from OROP – a clause which was reversed later – was viewed by veterans as a “last minute effort by bureaucrats to create troubles” in OROP.

For its part, the government has remained silent on the subject since its announcement of the roll out on September 5. Everything now depends on its final call in the order expected in October.

Source: Indian Express