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Ahead of polls, government woos employees with new pay panel

In a move that would benefit about eighty lakh families including 50 lakh government employees and 30 lakh pensioners, the government on Wednesday announced setting up of the 7th Pay Commission,  which will go into the salaries, allowances and pensions of about 80 lakh of its employees and pensioners. The announcement was made by Finance Minister P Chidambaram.

No separate pay panel would be set up for the defence forces, as was suggested in 2009. However, according to sources, an officer of the rank of Major General or equivalent would be put on the panel as member to ensure parity with their counterparts in the civilian administration. Indian Air Force chief NAK Browne had demanded a fair representation of the armed forces in the 7th Pay Commission, announced on Wednesday, against the backdrop of controversies over alleged anomalies in implementation of the last pay panel report.

In a letter written to Defence Minister A K Antony this month, the armed forces had backtracked from their earlier demand of having a separate pay commission for military personnel. ‘The IAF chief, who is also the Chairman, Chiefs of Staff Committee, has asked the Defence Minister and through him the government to have a full representation of the armed forces in the central pay commission,’ an IAF official said here.

‘Prime Minister Manmohan Singh approved the constitution of the 7th Pay Commission. Its recommendations are likely to be implemented with effect from January 1, 2016,’ finance minister P Chidambaram said in a statement. The setting up of the commission comes ahead of the assembly elections in five states in November and the general elections next year.

The government constitutes Pay Commission every ten years to revise pay scales of its employees and often these are adopted by states after some modification. As the commission takes about two years to prepare its recommendations, the award of the seventh pay panel is likely to be implemented from 1 January, 2016, Chidambaram said.

The sixth Pay Commission was implemented from 1 January, 2006, fifth from 1 January, 1996 and fourth from 1 January, 1986. The names of the chairperson and members of the 7th Pay Commission and its terms of reference will be finalised shortly after consultation with major stakeholders, Chidambaram said.

Last week, the union cabinet had approved a proposal to hike dearness allowance to 90 per cent from existing 80 per cent. The increase in DA to 90 per cent would result in additional annual expenditure of Rs 10,879 crore. There would be an additional burden of Rs 6,297 crore on exchequer during 2013-14 on account of this hike in DA.

Welcoming the constitution of the Seventh Pay Commission, the Congress on Wednesday recalled that the BJP-led NDA government had ‘rejected’ the legitimate formation of the Sixth Pay Commission in 2003.

Party general secretary in-charge for communication Ajay Maken hailed the announcement. ‘The 7th Pay Commission of Govt employees announced. Except for 6th Pay Commission all Pay commissions are set up in 3rd year of a decade....The government should attract best of talents as its employees. Pay Commissions help in attracting and also retaining best available talents,’ Maken commented on the microblogging site Twitter. He recalled that the NDA government had rejected the Sixth Pay Commission in 2003.
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