7th Pay Commission - Government Firmly Rejects Demand to Reduce Pay Gap

7th Pay Commission - Government Firmly Rejects Demand to Reduce Pay Gap

The pay gap under the 7th Pay Commission was a major issue for Central Government employees. The cabinet decided go ahead with the recommendations of the pay panel which suggested 14.27 per cent hike in basic pay which was effective from January 1 2016.

The cabinet had cleared the recommendations of the pay panel in June which effected 4.8 million central government employees and 5.2 million pensioners.

Recommendations by-passed

While clearing the pay panel’s recommendations the basic hike in pay effective January 1 2016 was at 14.27 per cent. The recommendations made by the Empowered Committee headed by Cabinet Secretary P K Sinha for an average 30 per cent hike in basic pay was bypassed by the Union Cabinet.

Pay matrix

As per the notification there were 18 pay matrices that were approved. The notification said, the highest pay matrix (Level-18) for the Cabinet secretary to the Union government is Rs 2,50,000 (fixed), which was Rs 90,000 (fixed) in the immediate past under 6th pay commission recommendation. The rate of increase is 178%. The pay matrix in the lowest grade (Level-1) is Rs 18,000 which was Rs 7,000 under 6th pay commission recommendation. The rate of increase is 157%.

The ratio of pay between the highest declared pay matrix (Level-18) and the lowest grade (Level -1) in the 7th Pay Commission recommendations is 1:13.9, which was 1:12 as per the previous pay commission:

No Pay Gap made up

All pay commissions in the past had made up the pay gap between the lower paid employees and the top officials from second Pay Commission 1:41 ratio to Sixth pay commission 1:12. In the first pay commission, the pay of the top bureaucrats was 41 times higher than the employee earning the lowest. The future pay commissions however reduced the ratio from 1:41 in 1947 to about 1:12 in 2006.

Reducing Pay Gap Ruled Out

Reliable sources confirm, the government has put aside the demand by central government employees to reduce the pay gap. The government has categorically made it clear that no decision will be taken to reduce the pay gap under the 7th Pay Commission, confirm sources. Government employees have been demanding for a long time to pay ratio should be minimised. They have also demanded that Rs 25,000 should be the minimum pay in the new pay scale and the fitment factor will be higher than the 2.57 times approved by the government based on the pay commission recommendations.