The rate of increase of pay is the minimum in the 7th CPC. The fitment factor is only 2.57 for all categories of employees except the top-level bureaucrats.
The other less-discussed highlights of Finance Minister's announcement are:-
1. The Cabinet also approved the recommendation of the Commission to enhance the ceiling of House Building Advance from Rs 7.50 lakh to 25 lakh. Only four interest-free advances, viz., Advances for Medical Treatment, TA on tour/transfer, TA for family of deceased employees and LTC have been retained. All other interest-free advances have been abolished.
2. The Cabinet also decided not to accept the steep hike in monthly contribution towards CGEGIS recommended by the Commission. The existing rates of monthly contribution will continue. This will increase the take home salary of employees at lower levels by Rs 1,470. However, considering the need for social security of employees, the Cabinet has asked Ministry of Finance to work out a customised group insurance scheme for Central Government Employees with low premium and high risk cover.
3. A Committee is being constituted to address the implementation issues anticipated in the first formulation. The first formulation to be made applicable if its implementation is found feasible after examination by proposed Committee which is to submit its Report within 4 months.
4. The Commission examined 196 existing Allowances and by way of rationalisation, recommended abolition of 51 Allowances and subsuming of 37 Allowances. Given the significant changes in the existing provisions for Allowances which may have wide-ranging implications, the Cabinet decided to constitute a Committee headed by Finance Secretary for further examination of the recommendations of 7th CPC on Allowances. The Committee will complete its work in a time-bound manner and submit its report within a period of 4 months. Till a final decision, all existing Allowances will continue to be paid at the existing rates.
5. The Cabinet also decided to constitute two separate Committees (i) to suggest measures for streamlining the implementation of National Pension System (NPS) and (ii) to look into anomalies likely to arise out of implementation of the Commission's Report.
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