DA increase for central government employees

"The Union Cabinet today approved the proposal to release an additional instalment of DA and dearness relief (DR) to pensioners with effect from January 1, 2014, in cash, but not before the disbursement of the salary for the month of March 2014 at the rate of 10 per cent increase over the existing rate of 90 per cent," said an official statement.

Central government employees as well as pensioners are entitled for DA/DR at the rate of 100 per cent of the basic with effect from January 1, 2014, it said.

The increase is in accordance with the accepted formula based on the recommendations of the 6th Central Pay Commission.

The government has estimated that the combined impact on exchequer on account of both DA and DR would be Rs 11,074.80 crore per annum. For a period of 14 months, from January 2014 to February 2015, the impact will be Rs 12,920.60 crore in the next financial year, 2014-15. (March salary gets paid in April, the first month of the new fiscal).

This increase in the dearness allowance by the UPA-2 government comes ahead of the imposition of the model code of conduct by the Election Commission.

DA merger for Central Goverment employees

The Union Cabinet could approve a proposal to merge dearness allowance (DA) with basic pay, benefiting about 50 lakh central government employees and 30 lakh pensioners.

The Cabinet may also hike dearness allowance (DA) by 10 percent to 100%. 

As per practice, the DA is merged with basic pay when it breaches the 50% mark. DA merger helps employees as their other allowances are paid as a proportion of basic pay.

The government had announced a hike of 10 percent to 90 percent in September last year, effective from July 1, 2013.

According to officials, the preliminary assessment suggests that dearness allowance hike will not be less than 10% and would be effective from January 1 this year.

The government uses CPI-IW data of the past 12 months to arrive at a quantum for the purpose of any DA hike. Therefore, the retail inflation for industrial workers between January 1 to December 31, 2013 would be used to take a final call on the matter.

7TH CENTRAL PAY COMMISSION FOR 

CENTRAL GOVERNMENT EMPLOYEES

           Shri HARIBHAU MADHAV JAWALE, Member of Parliament sought reply from The Minister of State in the Ministry of Finance Shri. NAMO NARAIN MEENA in Lok Sabha regarding the matter of Constituting 7th Pay Commission.

The following were the Questions raised by Shri HARIBHAU MADHAV JAWALE in Lok Sabha

UNSTARRED QUESTION NO 723

Will the Minister of FINANCE be pleased to state:-
(a) Whether the Government has received any demands to set up the 7th Central Pay Commission (7th CPC); and
(b) if so, the details thereof and the action taken/being taken thereon?

The Answer given by The Minister of State in the Ministry of Finance Shri. NAMO NARAIN MEENA For the above questions in LokSabha  is given below

ANSWERED ON 01.03.2013
MINISTER OF STATE IN THE MINISTRY OF FINANCE (SHRI NAMO NARAIN MEENA)

(a) & (b) : There have been some demands received for setting up of the 7th Central Pay Commission. In the past, there has generally been a gap of a minimum 10 years between two successive Pay Commissions. The recommendations of the previous Central Pay Commission, viz., 6th Central Pay Commission were given effect to from 1.1.2006. Therefore, at present no proposal to constitute the 7th Central Pay Commission is under consideration of the Government.

Central Govt has set up 6th pay commission in its effort to provide a fitting salary to central govt servants. Is it going to be burden on tax payers or increasing efficiency of govt machinery?