7th Pay Commission: Madhya Pradesh government to start giving benefits from July onwards

Many expected that the state government would implement the same in budget for year 2017-18 but that did not happen.

Madhya Pradesh Finance Minister, Jayant Malaiya, this week announced that the state government employees will start receiving the Seventh Pay Commission benefits from July 1 onwards.

However, this is to be noted that even after the several requests, the MP cabinet has not yet cleared the implementation of the 7th Pay Commission.

"The proposal to provide the benefits of the 7th Pay Commission to the employees would come in the state cabinet by June-end. However, the government has agreed to provide the benefits to its employees from July 1 this year", Malaiya said.

An increase in the dearness allowance (DA) and the implementation of 7th Pay Commission recommendations were pending with the Madhya Pradesh government's finance department since March this year.

Many expected that the state government would implement the same in budget for year 2017-18 but that did not happen.

A Times of India report quoted  Jitendra Singh, president of the Employees' Joint Forum as saying, "There were some discrepancies in the 5th and 6th Pay Commissions as employees were given a hike in the salary as per the recommendations of the Brahmaswaroop Committee. The benefit was expected in 1996 but it was adjusted in the 6th Pay Commission. The employees will not accept this".

Meanwhile, Prime Minister Narendra Modi met Finance Minister Arun Jaitley and Finance Secretary Ashok Lavasa earlier this week to discuss his views on Pay Commission allowances. Following the meeting, Modi directed that the allowance benefits should be given to central government employees without delay.

On the other hand, The matter of central government employees' allowances has been pending for almost one year now and the hiccups seem to stick even towards the end. The Pay Commission had recommended that out of a total 196 allowances, 52 be discontinued entirely whereas 36 other allowances should be subsumed under other allowances.

Apart from this, the pay panel called for cutting down the House Rent Allowance (HRA) which constituted the bulk of an employee's paycheck. The Pay Commission suggested HRA to be brought down to 24 per cent, 16 per cent and 8 per cent of the basic pay, to be paid according to the city the employee is positioned in.

The preceding Pay Commission had pegged the same at 30 per cent, 20 per cent and 10 per cent. The Cabinet formed the Committee on Allowances under Finance Secretary Ashok Lavasa in June last year after the central government employees expressed their dissatisfaction against them. The motive of this Committee was to look into the extensive changes suggested by the 7th Pay Commission.

The Lavasa Committee handed over its review report to Jaitley in April after consulting representations from various government departments and agencies. After approved by the Department of Expenditure, this report was forwarded to E-CoS for their consideration and consolidation.

The Empowered Committee submitted the report once again to the Finance Minister on June 1. Reports state that the E-CoS has capped HRA rates between 25 per cent and 27 per cent. The Cabinet may, however, approve rates higher than that to compensate for the delay in paying allowances as per new rates according to the 7th Pay Commission.

The final move now is for Cabinet to approve the recommendations about the allowance structure, has been awaited for two weeks now.