The long wait of veterans and central government employees has finally come to an end. Indian government decided to pay the 7th pay commission arrears in one instalment with the August pay. As it is notified earlier the 2.57 hike in basic pay of 4.7 million government employees and 5.3 million pensioners, which is effective from January 1, 2016, will be paid in cash.
Finance Minister, Arun Jaitley said that the revised pay scale will include the existing DA (dearness allowance) of 125%, and he said that the rate of the first instalment of DA under the new payment would be announced later in the year.
In a statement Arun Jaitley said, “The arrears as accruing on account of revised pay consequent upon fixation of pay under CCS (RP) Rules, 2016 with effect from January 1, 2016, shall be paid in cash in one installment along with the payment of salary for the month of August, 2016, after making necessary adjustment on account of GPF and NPS, as applicable, in view of the revised pay.”
Besides, it is also noted that the benefits of disbursing arrears without pre-check of fixation of pay will not be available for the government employees who have retired, resigned or dismissed after the implementation date of the 7th Pay Commission recommendations.
The minimum pay for the central government employees now will be from Rs. 7,000 to Rs. 18,000 per month. And at the highest level of cabinet secretary, the salary would be Rs 90,000 per month up to Rs 2.5 lakh. An instruction later said that income tax would be deducted from the arrears of payment.