7th Central Pay Commission Implemented

Recommendations of 7th CPC on pay and pensionary pensionary benefits benefits will come into effect from 01.01.2016.
7th CPC recommendations are being implemented within 6 months from the due date.
Arrears of pay & pensionary benefits to be paid during FY 2016-17 itself, unlike past when parts of arrears were paid in the next FY.
Award of 7th CPC approved by Cabinet will benefit over 1 crore employees including over 47 lakh central government employees and 53 lakh pensioners, pensioners, of which 14 lakh employees employees and 18 lakh pensioners are from defence forces.

PAY

PENSION

General recommendations of Commission on pension and related benefits approved
Both options of Commission regarding pension revision accepted subject to feasibility of their implementation
Revision of pension using second formulation based on fitment factor of 2.57 shall be implemented immediately.
Committee to address the implementation issues anticipated in first formulation.
First formulation to be made applicable if its implementation implementation is found feasible feasible after examination examination by proposed Committee which is to submit its Report within 4 months.
Gratuity increased from 10 to 20 lakh

ALLOWANCES AND ADVANCES

Committee headed by Finance Secretary to examine recommendations on Allowances in view of significant significant departure departure from existing existing system and demands from employees for review
Report of Committee to be submitted in 4 months
Pending final decision based on the report of the Committee, all allowances to be paid as per existing rates in existing pay structure
Interest bearing advances – HBA and PC advance retained. HBA ceiling raised to 25 lakh from 7.5 lakh
All interest free advances abolished except for –medical treatment, TA on tour/Transfer, TA for family of deceased deceased employee employee and LTC to avoid hardship to employees.

OTHER ISSUES

The existing rates of monthly contribution towards Group Insurance – CGEGIS to continue.
MoF to work out a customized group insurance scheme with low premium and high risk cover.
Ex-gratia lump sum compensation for civil and defence forces personnel payable to Next of Kin enhanced from 10-20 lakh to 25-45 lakh.
Military Service Pay increased from 1000 2000 1000, 2000, 4200 & 6000 to 3600, 5200, 10800 & 15500
Terminal gratuity for Short Service Commissioned Officers exiting between 7 and 10 years of service increased to 10.5 times reckonable emoluments.
All administrative issues other than pay, pension and allowances to be examined by concerned Ministries/Departments
Two separate Committees to be set up to
suggest measures for streamlining the implementation of National Pension System (NPS);
to look into anomalies likely to arise out of implementation of the Commission’s Report.

FINANCIAL IMPLICATIONS

Additional financial impact, as per 7th CPC, on account of implementation of all its recommendations recommendations for 2016-17 will be 1,02,100 crore (including Allowances)
Additional implication of 12,133 crore on account of payments of arrears of pay and pension for two months of 2015-16

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