6th Pay Commission notification brings joy to people’s faces

6th Pay Commission notification brings joy to people’s faces

By Husna Anjum

New Delhi, Aug 31, 2008: 6th Pay Commission notification brings joy to people’s faces. It has made 5.5 million central government employees happy. They say the pay panel recommendations’ implementation could not have come at a more opportune time. It has relieved millions of Government employees from top to the lowest order.

Steep price rise had troubled central government employees like never before. The inflation had eaten into the savings of the most people and most of the people had to fall back on either loans from relatives or from banks at ever increasing rates.

The life was becoming very tough for most of the people who work in the central government enterprises. The cash crunch was affecting most of the families and they were under increasing distress.

Sixth pay commission at least relieves the central government employees in some small ways. The 40 percent arrears that the central government workers will get this month will help them pay their debts and also save a part of the money that comes their way.

Though many people are not pleased with the way only 40 percent amount of arrears is being paid this year. Many people say that they had hoped that they will be paid full arrears in one go and that it would have helped them tide over their precarious economic condition in a better way. They say that 40 percent arrears is insignificant for them and would do no good to their lives.

Manjeet Singh who works with central school says that he had to go for a large loan to take care of his kids’ education, hoping that he would be able to pay for the loan when his arrears are paid, but he says that he will have to take loan again to pay for the previous loan as the 40 percent arrear he is being paid this year is utterly insignificant for the purpose.

The same is the story of Rekha Bhardwaj, who is working with postal department. She feels that neither pay rise is sufficient to tide over the increasing inflation nor 40 percent payment of arrears are enough to take care of loan that they have been forced to take during the last one year.

But there are many people who say that it will help them in some ways at least. Rajeev, a central government employee in New Delhi says that with increasing inflation he was under increased distress. No amount of restrained spending was enough to keep the household expenses under control. Repeatedly I was forced to borrow during the last six months.

Rajeev adds that the new pay raise will give him and his family some breathing space and the back pay would help him pay the loan he has accumulated.

The same is the story of most of the central government employees. With inflation hovering around 13 percent, the highest in more than a decade, the life of ordinary people has changed from bad to worse. But for at least 4.5 million central government employees it gives some respite.

The pay hike would cost union government 125.61 billion rupees for the current fiscal year 2008/09, and 180.60 billion rupees in backpay from January 2006 till date.

Some important features of Sixth Pay Commission after notification

Pay Band and Grade pay:

* Grade Pay up to PB2 recommended by 6CPC accepted as such.

* Revised Grade pay from PB3 and above. Check New pay band and Grade Pay

* The basic pay drawn as on 1.1.2006 on the existing Fifth CPC pay scales will be multiplied by a factor of 1.86 and then rounded off to next multiple of 10. This will be the pay in the revised running Pay Band. Grade Pay, as approved by the Government, corresponding to the pre-revised pay scale, will then be added to the Pay in the revised Pay Band. The total of pay in the Pay Band and grade pay will be the revised Basic Pay as on 1.1.2006.
* Rate of annual increments will be 3% and the rate of variable increment for high achievers in PB-3 will be 4%.

* There will be a uniform date of annual increment, viz. 1st July of every year. Employees completing 6 months and above in the revised pay structure as on 1st of July will be eligible to be granted the increment. The first increment after fixation of pay on 1.1.2006 in the revised pay structure will be granted on 1.7.2006 for those employees for whom the date of next increment was between 1st July, 2006 to 1st Jan 2007.

DA and other Allowances

* AICPI (IW) with base 2001 may, henceforth, be used for the purpose of calculating DA till it gets revised. The base using the 2001 series works out to be 115.76. Based on this index the revised DA as on Jan-06, July-06, Jan-07, July-07, Jan-08 and July-08 are estimated to be 0%, 3%, 6%, 9%, 12%, and 16% respectively (based on the calculation made as per index - Exact DA rates are yet to be confirmed by the Govt).

* “Campus” restriction for grant of Transport Allowance will be removed. Consequently, employees living in campuses will also be eligible for Transport Allowance. Further, Transport Allowance for the employees at the lowest levels will be increased to Rs.600 (from Rs.400) in A-1/A class cities and Rs.400 (from Rs.300) in other towns.

* New TA - Employees drawing grade pay of Rs. 5400 and above will be eligible to receive TA of Rs.3200 and DA thereon (A1/A class cites) and Rs.1600 and DA thereon (other places. Similarly Employees drawing grade pay of Rs.4200 to Rs.4800 will be eligible to receive TA of Rs. Rs.1600 and DA thereon (A1/A class cites) and Rs.800 and DA thereon (other places). Employees drawing grade pay of below Rs. 4200 will be eligible to receive TA of Rs. 600 and DA thereon (A1/A class cites) and Rs.400 and DA thereon (other places).

* City Compensatory Allowance abolished.

* Employess living in X (Earlier classified as A-1), Y (Earlier classified as A, B-1 & B-2), and Z (Earlier classified as C and Unclassified) will be eligible for HRA of 30%, 20% and 10% (on Fixed Pay and Grade Pay) respectively.

* Children Education Allowance and Reimbursement of Tuition Fee are merged and reimbursement of Children Education allowance will be paid upto the maximum of Rs.1000 per child per month subject to a maximum of 2 children. Hostel subsidy will be reimbursed upto the maximum limit of Rs.3000 per month per child. The limits would be automatically raised by 25% every time the Dearness Allowance on the revised pay bands goes up by 50%.

* Cycle Allowance, Washing Allowance, Cash Handling Allowance, Special Allowance, Night Duty Allowance and Split Duty Allowance have been doubled. Similarly, rates of allowances specific to different Ministries/Departments/Organisations not covered in this Report will also be doubled. The rates of these allowances will be increased by 25% every time the Dearness Allowance payable on revised pay scales goes up by 50%.

* All provisions concerning travel under LTC are to be retained except frequency of travel in home town concession (up to three times during the first two blocks of 4 years after joining the service).

* The revised allowances, other than dearness allowance, will be effective from 1st day of September, 2008.

ACP (Assured Career Progression):

* Three upgradations will be granted under Assured Career Progression (ACP) Scheme at 10, 20 and 30 years as per the modified ACP Scheme recommended by the Commission. ACP Scheme will also be applicable to Group A employees.

* Financial upgradation through ACP will be available whenever a person has spent 10 years continuously in the same grade.

* Benefit of pay fixation available at the time of normal promotion shall be allowed at the time of financial upgradations under the scheme. Thus, an increase of 3% of pay and grade pay shall be available as financial upgradation under the scheme.

Other Points accepted by the Govt:

* The Commission’s recommendation regarding payment of arrears has been modified to the extent that the arrears will be paid in cash in two instalments – first instalment of 40% during the current financial year (2008-09) and the remaining 60% in the next financial year (2009-10).

* The Government has approved setting up of Anomalies Committees to examine individual, post-specific and cadre-specific anomalies. The Anomalies Committees should endeavour to complete their work in one year.

Recommendations not accepted by the Govt:

* Liberal ‘severance package’ for those employees who want to leave service without pension with more than 15, but less than 20 years of service.

* Recommendation relating to Holiday Policy that there should only be three closed holidays for Government employees.

* Flexi-hours for women employees and flexi-weeks for employees with disabilities.

Recommendations of Sixth CPC which will be examined separately :

* Recommendation related to Bonus and Over Time Allowance.

* Recommendation related to General Provident Fund for Central Government employees and Central Government Employees Group Insurance Scheme.

* Introduction of Health Insurance Scheme for Central Government employees and pensioners.

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