7th CPC report Abolishing 52 ALLOWNCE

7th Pay Commission has recommended Abolishing 52 Allowances

1. Air Despatch pay
2. Air Steward Allowance
3. Assisting Cashier Allowance
4. ASV Allowance
5. Breakdown Allowance
6. Cash Handling Allowance
7. Coal Pilot Allowance
8. Command Allowance
9. Commando Allowance
10. Commercial Allowance
11. Condiment Allowance
12. Court Allowance
13. Cycle Allowance
14. Desk Allowance
15. Diet Allowance
16. Electricity Allowance
17. Entertainment Allowance for Cabinet Secretary
18. Entertainment Allowance in Indian Railways
19. Family Planning Allowance
20. Flying Squad Allowance
21. Funeral Allowance
22. Handicapped Allowance
23. Headquarters Allowance
24. Hutting Allowance
25. Investigation Allowance
26. Language Reward and Allowance
27. Launch Campaign Allowance
28. Metropolitan Allowance
29. Night Patrolling Allowance
30. Official Hospitality Grant in Defence Forces
31. Operation Theatre Allowance
32. Organization Special Pay
33. Out-Ture Allowance
34. Overtime Allowance (OTA) (pic)
35. Rajdhani Allowance
36. Rent Free Accommodation
37. Risk Allowance
38. Savings Bank Allowance
39. Secret Allowance
40. Shorthand Allowance
41. Space Technology Allowance
42. Special Compensatory (Hill Area) Allowance
43. Special DOT Pay
44. Special NCRB Pay
45. Special Scientists Pay
46. Spectacle Allowance
47. Study Allowance
48. Sumptuary Allowance in Training Establishments
49. Sumptuary Allowance to Judicial Officers in Supreme Court Registry
50. Training Stipend
51. Treasury Allowance
52. Vigilance Allowance

1. Air Despatch Pay, Air Steward Allowance, Shorthand Allowance:-

8.3.27 Air Despatch Pay is granted to PBORs of Defence services who are employed for air dropping of supplies in forward areas. The current rate is ₹360 pm. Air Steward Allowance is granted to Group “Y” tradesmen of the Indian Air Force who are employed on board VVIP flights for steward duties. The existing rate is ₹900 pm. Shorthand Allowance is payable to PBORs of Indian Air Force and Indian Navy employed on shorthand duties. The present rate is ₹360 pm.

8.3.28 There are demands to abolish these allowances and grant alternative compensation to the affected employees.

Analysis and Recommendations

8.3.29 These allowances are paid to very few personnel of the Defence forces. The Commission is of the view that these kinds of duties are intrinsic to the related job profile and additional allowance is not justified. Accordingly, it is recommended that these three allowances should be abolished.

2. Air Steward Allowance

8.2.27 (first Point Read More)

8.3.28 (first Point Read More)

8.3.29 (first Point Read More)

3. Assisting Cashier Allowance

8.10.4 This allowance is granted only in the Ministry of Consumer Affairs, Food and Public Distribution, to MTS staff for assisting cashier in bringing cash from banks. The current rate is ₹90 pm

4. ASV Allowance

8.10.5 This allowance is granted to Accounts Stock Verifiers of Indian Railways on Account of hardship involved in their job. The present rate is ₹ 1,000 pm.

5. Breakdown Allowance

8.10.8 This allowance is granted to non-gazetted Railway servants who are earmarked for attending to breakdown duties. The present rates are:

Grade Pay	Rate ( ₹ per month)
Up to ₹ 1800	120
₹1900	180
₹2400 – ₹2800	240
₹4200 and above (limited to non-gazetted staff)	300

6. Cash Handling Allowance

8.10.9 It is paid to cashiers working in Central Government department, for handling of cash. The current rates are:

Amount of Average Monthly Cash Disbursed	Rate ( ₹ per month)
<₹50,000	230
Over ₹50,000 and up to ₹2,00,000	450
Over ₹2,00,000 and up to ₹5,00,000	600
Over ₹5,00,000 and up to ₹10,00,000	750
>₹10,00,000	900

7. Coal Pilot Allowance

8.10.12 It is paid to Shunt men and other Group D staff of transportation Department of Indian Railways who accompany pilots in the collieries for shunting and similar other duties. The present rates are:

For First Trip	₹45 per trip
For every Subsequent Trip	₹15 per trip

8. Command Allowance

8.17.18 This allowance is granted to certain personnel in CAPFs for shouldering higher responsibilities at the rate of ₹100 pm. There are demands to raise this allowance five-fold.

Analysis and Recommendations

8.17.19 Not only is the amount of allowance meagre, there is no valid justification for its continuation Accordingly, it is recommended that Command Allowance should be abolished.

9. Commando Allowance

8.10.14 This allowance is granted to personnel of Delhi Police who act as Commandos. The existing rates are:

SI	₹100pm
Head Constable	₹75 pm
Constable	₹50 pm

10. Commercial Allowance

8.17.20 Commercial Allowance is granted to Announcers, ECRCs, Commercial clerks, TCs of Indian Railways for performing certain commercial duties at the rate of ₹180 pm. No demands have been received regarding this allowance.

Analysis and Recommendations

8.17.21 The amount of the allowance is meagre and no valid justification has been provided for its continuation. Hence, it should be abolished.

11. Condiment Allowance

8.17.26 Condiment Allowance is paid to those non-gazetted personnel of Defence forces and CAPFs who dine in the mess, at the rate of ₹89.78 pm. No demands have been received regarding this allowance.

Analysis and Recommendations

8.17.27 Condiment Allowance is not an allowance in the true sense of the term, i.e., it is not paid to an individual, but to the Unit for collective purchase of condiments. As such, it is proposed to abolish this allowance, and the expenditure on condiments may be termed as Condiment expenditure and should be shown as such under the relevant budget head.

12. Court Allowance

8.17.32 Court Allowance is granted to Legal Officers in National Investigation Agency (NIA) to meet the miscellaneous expenditure incurred in court. The present rates are ₹1,500 pm to Public Prosecutor and Sr.Public Prosecutor, and ₹2,000 pm to Dy.Legal Advisor. No demands have been received regarding this allowance.

Analysis and Recommendations

8.17.33 The Commission does not find the allowance justified. Hence, it is recommended that it should be abolished.

13. Cycle Allowance

8.15.10 It is paid where the duties attached to the post require extensive use of bicycle and the official concerned has to use and maintain his own cycle for official journeys. The existing rate is ₹90 pm. No demands regarding Cycle Allowance have been received.

Analysis and Recommendations

8.15.11 The Commission is of the view that amount of this allowance is meagre and the allowance itself is outdated. Hence, it should be abolished.

14. Desk Allowance

8.17.38 Desk Allowance is granted to Desk Officers in CSS and other HQ services at a rate of ₹900 pm. No demands have been received regarding this allowance.

Analysis and Recommendations

8.17.39 This allowance is virtually non-existent since 2010 and there are very few instances of its payment now. Besides no valid justification has been provided in support of this allowance. Thus, it is recommended that Desk Allowance should be abolished.

15. Diet Allowance

8.17.40 Diet Allowance is granted to deputationists in Bureau of Immigration as compensation for food, at a rate of ₹200 pm. No demands have been received regarding this allowance.

Analysis and Recommendations

8.17.41 The amount of the allowance is meagre and no valid justification has been provided for its continuation. Hence, it is recommended that the allowance should be abolished

16. Electricity Allowance

8.17.46 Personnel belonging to the Defence Forces are permitted reimbursement of electricity charges for the first 100 units of electricity. No demands have been received regarding this allowance.

Analysis and Recommendations

8.17.47 This allowance is petty in nature and with the increase in pay proposed, there is no justification for its continuation. Hence, it should be abolished.

17. Entertainment Allowance

8.13.3 An Entertainment Allowance of ₹10,000 pm is granted to Cabinet Secretary to entertain distinguished visitors.

18. Entertainment Allowance in Indian Railways

8.13.4 Similar allowance is granted to officers of Indian Railways also, the existing rates of which are as under:

	(₹ per annum)
PHOD	6000
DRM	6000
CWM	5000
SAG	4500
SG/JAG	2500
STS (Independent Charge)	2000
STS	1600
JTS	1000

19. Family Planning Allowance

8.17.48 Family Planning Allowance (FPA) is granted to Central Government employees as an encouragement to adhere to small family norms. The existing rates are as under:

Grade Pay	(₹ per month) Family Planning Allowance
1300-2400	210
2800	250
4200	400
4600	450
4800	500
5400	550
6600	650
7600	750
8700	800
8900	900
>10,000	1000

8.17.49 There are demands to make it equal to one increment. Representations have also been received requesting that the allowance should be double for those employees who adopt family planning norms after just one child.

Analysis and Recommendations

8.17.50 The Commission recognizes the fact that most of the benefits related to children, viz.,Children Education Allowance, Maternity Leave, LTC, etc., are available for two children only. Moreover the level of awareness regarding appropriate family size has also gone up among the government servants. Hence, a separate allowance aimed towards population control is not required now. Accordingly, it is recommended that Family Planning Allowance should be abolished.

20. Flying Squad Allowance

8.10.21 It is paid to Chief Ticket Inspectors (CTIs) and Travelling Ticket Examiners (TTEs) of Indian Railways who are part of the Flying Squads constituted for surprise ticket checking in trains. The current rate is ₹300 pm.

21. Funeral Allowance

8.17.53 When death of an employee occurs in peace areas, a funeral allowance of ₹6,000 is granted and mortuary charges are reimbursed to Defence personnel. Demands have been received to extend that allowance to all civilian employees and for a four-fold increase in rates.

Analysis and Recommendations

8.17.54 The Commission is of the view that with the pay raises provided by successive Pay Commissions, this kind of an allowance has lost its meaning. Hence, it is recommended to be abolished.

22. Handicapped Allowance

8.10.23 It is a conveyance allowance granted to differently abled employees in Indian Railways. This allowance is granted to employees who are visually challenged, orthopedically challenged and staff suffering from spinal deformity. The present rate is 5 percent of Basic Pay, subject to a maximum of ₹100 pm.

23. Headquarters Allowance

8.10.25 It is granted to officers of Organised Group `A’ Service in DOT and certain other ministries upon posting at headquarters. The existing rate is ₹225 pm.

24. Hutting Allowance

8.7.28 This allowance is granted to Railway servants living outside Railway premises who, for the outbreak of plague in epidemic forms, are compelled to vacate their houses and to erect temporary huts on Railway land or elsewhere. The present rate of the allowance is ₹100 pm. No demands have been received regarding this allowance.

Analysis and Recommendations

8.7.29 The allowance is outdated. It is recommended for deletion.

25. Investigation Allowance

8.17.62 Investigation Allowance is granted in Serious Fraud Investigation Office, Ministry ofCorporate Affairs, to attract talent pool from other ministries. The existing rates are as under:

Grade Pay	Rate ( ₹ per month)
8700	2000
6600	1400
5400	1400
4800	1400

Analysis and Recommendations

8.17.63 There is no justification for continuation of this allowance. Accordingly, it is recommended that the allowance should be abolished.

26. Language Reward and Allowance

8.9.39 This allowance is payable to MEA officers who have learnt optional foreign language when posted in the region where the language is main language or widely used. The present rate varies from ₹100 pm for being “proficient” to ₹200 pm for being “above proficient.” No demands have been received regarding this allowance.

Analysis and Recommendations

8.9.40 The amount of the allowance is meagre. Hence, it should be abolished.

27. Launch Campaign Allowance and Space Technology Allowance

8.17.67 Space Technology Allowance is granted to supporting scientific and technical staff in DOS/ISRO in recognition of the need for their retention and keeping in view the fact that they play a crucial role in the success of every mission. Considering that all missions/projects of ISRO are implemented in campaign mode and all categories of employees have to work with extra vigour, it was decided to give a lump sum Launch Campaign Allowance to all administrative staff working in DOS/ISRO to appreciate and recognize their contribution to ISRO. Both the allowances are paid at the identical rate of ₹7,500 per annum. No demands have been received regarding this allowance.

Analysis and Recommendations

8.17.68 The allowances are in the nature of an appreciation allowance. Since PRIS has already been implemented in ISRO, there is no justification for the continuation of these allowances. Hence it is recommended that both these allowances should be abolished.

28. Metropolitan Allowance

8.10.33 This allowance is granted to personnel of Delhi Police on account of hardship faced in a Metropolitan area. The present rates are:

Sub-Inspector (SI)	₹180 pm
Constable, Head Constable, ASI	₹120 pm

29. Night Patrolling Allowance

8.10.34 It is granted to Trackmen of Indian Railways to compensate for hardship faced in Night Patrolling. The present rate is ₹10 per night of patrolling.

30. Official Hospitality Grant in Defence Forces

8.13.5 In the Ministry of Defence, this allowance goes by the name of Official Hospitality Grant, with the following rates:

	(₹ Per Month
Service Chiefs/VCs/Army Cdrs	3000
Leftinent General	2400
Major General	1800
Brigadier	1500
Cos of a Ship-Captain Rank	1200
Naval Officer-in-Charge/CO up to Cdr	600

31. Operation Theatre Allowance

8.10.35 This allowance is granted to 35 percent of the Staff Nurses in Central Government Hospitals, who work in ICU/Operation Theatres. The current rate is ₹240 pm.

32. Organization Special Pay

8.10.36 It is granted to certain categories of personnel in ITBP in view of the arduous nature of job. The extant rates are:

	(₹ Per Month)
Subedar (senior)	100
SM/Inspector	100
Sub-Inspector	60
Head Constable	40
Lance Naik/Naik	40
Constable	30

33. Out-turn Allowance

8.10.37 This allowance is granted to Telegraph Signaller/Tele printer Operator/Wireless Operators in Indian Railways as a remuneration for per message worked in excess of the specified number of messages during the normal duty hours on a nominated circuit. The current rates are:

	Post	No. of Minimum Messages
₹ 0.10 for each message in excess of 250 messages handled over the minimum number of messages sent or received in eight of six hour shift.	Telegraph Signaller	100
	Telegraph Operator	250
	Wireless Operator Link (Two Stations)	80
	Wireless Operator Net (> Two Stations)	60

34. Overtime Allowance (OTA)

8.17.89 Overtime Allowance (OTA) is granted to government employees for performing duties beyond the designated working hours. Presently, OTA is paid in several ministries/ departments, up to a certain level, at varying rates.

8.17.90 JCM-Staff Side has demanded that OTA should be paid to all government employees who are asked to work beyond office hours, on the basis of actual Pay, DA and Transport Allowance.

Analysis and Recommendations

8.17.91 Out of the total expenditure on OTA in Government of India in 2012-2013, over 90 percent is on account of just two ministries: MoR – Ministry of Railways and MoD – Ministry of Defence (Civilian employees). The Commission compared the OTA expenditure in these two ministries over the period 2006-07 to 2012-13.

8.17.92 In both the ministries, the amount of OTA is showing a rising trend.

8.17.93 The absolute numbers and amounts are as given below:

 OTA and Pay (including DA) in MoR and MoD (Civilian Employees)34

	2006-07			2012-13			CAGR of OTA	CAGR of Pay
	OTA	Pay	(A)/(B)	OTA	PAY	(X)/(Y)
	(A)	(B)		(X)	(Y)
MoR	304.88	14563.01	2.09%	791.65	30713.98	2.58%	17.24%	13.24%
MoD	398.15	5035.94	7.91%	732.73	1121.9	6.54%	10.70%	14.27%

8.17.94 There are two noteworthy points here:

6. While OTA as a percentage of Pay is declining in MoD (6.54% in 2012-13 compared to 7.91% in 2006-07), it is on the rise in MoR (2.58% in 2012-13 compared to 2.09% in 2006-07).
7. The Compound Annual Growth Rate (CAGR) of OTA (17.24%) in MoR exceeds even the CAGR of Pay (13.24%), or in other words, OTA is rising faster than pay.

8.17.95 This clearly shows that while MoD has achieved some success in its efforts to control OTA, the efforts of MoR have not yielded the desired results. However, at the same time, it should also be kept in mind that OTA as a percentage of pay is already much higher in MoD compared to MoR.

8.17.96 The Commission also took note of the recommendations of the III, IV, V and VI CPCs that OTA should be abolished except where it is a statutory requirement. However, it is also a fact that despite these recommendations, OTA continues to be paid to certain categories of staff (at rates that are quite old) even when it is not a statutory requirement.

8.17.97 Hence, while this Commission shares the sentiments of its predecessors that government offices need to increase productivity and efficiency, and recommends that OTA should be abolished (except for operational staff and industrial employees who are governed by statutory provisions), at the same time it is also recommended that in case the government decides to continue with OTA for those categories of staff for which it is not a statutory requirement, then the rates of OTA for such staff should be increased by 50 percent from their current levels.

8.17.98 A stricter control on OTA expenditure is also suggested.

35. Rajdhani Allowance

8.10.41 It is granted to Train Superintendent (TS) and Deputy Train Superintendent (Dy.TS) of Rajdhani Express Trains in Indian Railways, due to harder nature of their jobs. The current rate is ₹900 pm for TS and ₹360 pm for Dy.TS.

36. Rent Free Accommodation

8.7.32 This allowance is granted to IB personnel on confrere (a fellow member of a profession, fraternity, etc.) basis, if admissible to police personnel of equivalent rank at that station. No demands have been received regarding this allowance.

Analysis and Recommendation

8.7.33 The Commission opines that the allowance is outdated. Hence, it isrecommended for deletion

37. Risk Allowance

8.10.42 Risk Allowance is presently given to employees engaged in hazardous duties or whose work will have deleterious effect on health over a period of time. Risk Allowance is also paid to Sweepers and Safaiwalas engaged in cleaning of underground drains, sewer lines as well as to the employees working in trenching grounds and infectious diseases hospitals. The extant rate is ₹60 pm.

38. Savings Bank Allowance

8.10.43 In Department of Posts, granted to Postal Assistants working in Post Office Savings Bank (POSB) for shouldering strenuous and complicated nature of Savings Bank work. Postal Assistants need to qualify an Aptitude Test to get this allowance. The current rates are ₹300 pm for fully engaged staff and ₹150 pm for partially engaged staff.

39. Secret Allowance

8.10.46 This allowance is granted in Cabinet Secretariat, for dealing with Top Secret papers and performing sensitive and arduous nature of duty. It is paid as a flat sum per month based on the post held by the concerned official.

40. Shorthand Allowance

8.3.27, (First Point Read More)

8.3.28. (First Point Read More)

8.3.29  (First Point Read More)

41. Space Technology Allowance

8.17.67 (twenty-six Point Read More)

42. Special Compensatory (Hill Area) Allowance

8.10.48 It is granted to Central Government employees posted at Hill stations 1000 metres or more above sea level. The present rates are:

Grade Pay > ₹ 5400	Others
₹900 Pm	₹720 pm

43. Special DOT Pay

8.3.25 This allowance, at the rate of ₹400 pm, is granted to DOT officers for shouldering higher responsibility. No demands have been received regarding this allowance.

Analysis and Recommendations

8.3.26 The Commission does not find the continuation of this allowance justified. Hence, it is recommended that this allowance should be abolished.

44. Special NCRB Pay

8.17.123 Special NCRB Pay is granted to Assistant Director in C&S division and Deputy Superintendent (Finger Print) in Central Finger Print Bureau of National Crime Records Bureau, on the premise that the feeder posts of both the above mentioned posts lie in the same GP which is an anomaly. A proposal to upgrade the post of Assistant Director to GP 7600 and that of Deputy Superintendent (Finger Print) to GP 5400 (PB-3) has been sent to VII CPC. Until then, the Bureau has itself taken steps to sort out this “pay anomaly” by providing this allowance of ₹800 pm.

Analysis and Recommendations

8.17.124 The merger of certain V CPC pay scales by the VI CPC, led to similar situations in many cadres in which some posts and their feeder posts came to be in the same GP. The resolution to this has not been in the form of any such allowance. In fact, in many such cases there has been no resolution, as we have seen in the memoranda received. In this context, the presumption by NCRB that this constitutes an “anomaly,” to be “rectified” through an allowance is incorrect. Hence it is recommended that this pay should be immediately stopped.

45. Special Scientists Pay

8.17.125 Special Scientists’ Pay, at a rate of ₹4,000 pm, is granted to Scientists/Engineers H with GP 10000 because it was felt that the pay scale accorded to them by the V CPC was not commensurate with their status and was adversely affecting their morale. No demands have been received regarding this pay.

Analysis and Recommendations

8.17.126 Since the V CPC recommendations, much time has passed and the pay scales of all employees have been revised upwards. There is no rationale for the continuation of this allowance. Hence, it is recommended that this allowance be abolished.

46. Spectacle Allowance

8.17.130 Spectacles are issued free to those Defence Forces personnel in whose case impairment of vision is either attributable to service or their sight is so defective that it interferes with their efficiency. When spectacles are not issued, reimbursement is permitted in the form of Spectacle Allowance, at the following rates:

For Spectacles with normal lenses	₹ 130
For Spectacles with bifocal lenses	₹ 250

8.17.131 There are demands that the Spectacle Allowance should be abolished and adequately compensated in Composite Personal Maintenance Allowance.

Analysis and Recommendations

8.17.132 The amount of this allowance is meagre. Hence, it is recommended that this allowance should be abolished.

47. Study Allowance

8.17.135 Study Allowance, ranging from 1 to 2.75 Pound (Sterling) per day, is granted to a government servant who has been granted study leave for studies outside India, for the period spent in prosecuting a definite course of study at a recognized institution or in any definite tour of inspection of any special class of work as well as for the period covered by the examination at the end of the course of study. This allowance has been referred by the government to VII CPC for consideration.

Analysis and Recommendations

8.17.136 The rate of this allowance is meagre and not revised since 1972. Accordingly, it is recommended that the allowance should be abolished.

48. Sumptuary Allowance in Training Establishments

8.13.6 There exists a Sumptuary Allowance in National/Central Training Establishments for Group `A’ Officers, meant for entertaining small groups of students and faculty. The existing rates are:

For Director or Head	₹3500 pm
For Course Directors	₹2500 pm
For Counsellors	₹2000 pm

49. Sumptuary Allowance to Judicial Officers in Supreme Court Registry

8.13.7 Judicial Officers on deputation in the Supreme Court Registry are also granted a Sumptuary Allowance at the same rate as what they were getting in the parent office.

50. Training Stipend

8.17.139 Non Gazetted Officers of Delhi Police, while undergoing training, are entitled for Training Stipend at the rate of ₹80 pm.

Analysis and Recommendations

8.17.140 The stipend is meagre. Hence, it is recommended that Training Stipend should be done away with.

51. Treasury Allowance

8.10.57 This allowance is granted in Department of Posts to Treasurers and Assistant Treasurers working in Head Post Offices and large sub offices for handling of cash. The present rate is ₹360 pm for handling cash up to ₹2 lakh and ₹480 pm for handling cash more than ₹2 lakh.

52. Vigilance Allowance

8.17.141 A Vigilance Allowance of ₹2,500 pm is granted to Vigilance Inspectors in Indian Railways to attract experienced and talented staff.

Analysis and Recommendations

8.17.142 The Commission took note of two aspects regarding this allowance:

1. This allowance is paid only in Railways while there are posts of Vigilance Inspectors under other ministries as well.
2. No supporting evidence has been submitted by the Ministry of Railways to show that
3. Employees were unwilling to join the vigilance organization before the commencement of this allowance, and
4. The position has improved after this allowance was introduced.

8.17.143 In such a situation, the Commission recommends abolishing this allowance

The full report is available in the website, http://7cpc.india.gov.in

Highlights of Recommendations 7 th CPC

 7th CPC – Highlights of Recommendations Submitted to the Central Government…

Recommended Date of implementation: 01.01.2016

Minimum Pay: Based on the Aykroyd formula, the minimum pay in government is recommended to be set at ₹18,000 per month.

Maximum Pay: ₹2,25,000 per month for Apex Scale and₹2,50,000 per month for Cabinet Secretary and others presently at the same pay level.

Financial Implications:

The total financial impact in the FY 2016-17 is likely to be₹1,02,100 crore, over the expenditure as per the ‘Business As Usual’ scenario.  Of this, the increase in pay would be ₹39,100 crore, increase in allowances would be ₹ 29,300 crore and increase in pension would be ₹33,700 crore.

Out of the total financial impact of ₹1,02,100 crore, ₹73,650 crore will be borne by the General Budget and₹28,450 crore by the Railway Budget.

In percentage terms the overall increase in pay & allowances and pensions over the ‘Business As Usual’ scenario will be 23.55 percent. Within this, the increase in pay will be 16 percent, increase in allowances will be 63 percent, and increase in pension would be 24 percent.

The total impact of the Commission’s recommendations are expected to entail an increase of 0.65 percentage points in the ratio of expenditure on (Pay+Allowances+ Pension) to GDP compared to 0.77 percent in case of VI CPC.

New Pay Structure: Considering the issues raised regarding the Grade Pay structure and with a view to bring in greater transparency, the present system of pay bands and grade pay has been dispensed with and a new pay matrix has been designed. Grade Pay has been subsumed in the pay matrix. The status of the employee, hitherto determined by grade pay, will now be determined by the level in the pay matrix.

Fitment: A fitment factor of 2.57 is being proposed to be applied uniformly for all employees.

Annual Increment: The rate of annual increment is being retained at 3 percent.

Modified Assured Career Progression (MACP):

Performance benchmarks for MACP have been made more stringent from “Good” to “Very Good”.

The Commission has also proposed that annual increments not be granted in the case of those employees who are not able to meet the benchmark either for MACP or for a regular promotion in the first 20 years of their service.

No other changes in MACP recommended.

Military Service Pay (MSP): The Military Service Pay, which is a compensation for the various aspects of military service, will be admissible to the Defence forces personnel only. As before, Military Service Pay will be payable to all ranks up to and inclusive of Brigadiers and their equivalents. The current MSP per month and the revised rates recommended are as follows:

				Present	Proposed
	i.		Service Officers	₹6,000	₹15,500
	ii.		Nursing Officers	₹4,200	₹10,800
	iii.		JCO/ORs	₹2,000	₹  5,200
	iv.		Non Combatants (Enrolled) in the Air Force	₹1,000	₹  3,600

Short Service Commissioned Officers: Short Service Commissioned Officers will be allowed to exit the Armed Forces at any point in time between 7 and 10 years of service, with a terminal gratuity equivalent of 10.5 months of reckonable emoluments. They will further be entitled to a fully funded one year Executive Programme or a M.Tech. programme at a premier Institute.

Lateral Entry/Settlement: The Commission is recommending a revised formulation for lateral entry/resettlement of defence forces personnel which keeps in view the specific requirements of organization to which such personnel will be absorbed. For lateral entry into CAPFs an attractive severance package has been recommended.

Headquarters/Field Parity: Parity between field and headquarters staff recommended for similar functionaries e.g Assistants and Stenos.

Cadre Review: Systemic change in the process of Cadre Review for Group A officers recommended.

Allowances: The Commission has recommended abolishing 52 allowances altogether. Another 36 allowances have been abolished as separate identities, but subsumed either in an existing allowance or in newly proposed allowances. Allowances relating to Risk and Hardship will be governed by the proposed Risk and Hardship Matrix.

      Risk and Hardship Allowance: Allowances relating to Risk and Hardship will be governed by the newly proposed nine-cell Risk and Hardship Matrix, with one extra cell at the top, viz., RH-Max to include Siachen Allowance.

The current Siachen Allowance per month and the revised rates recommended are as follows:

		Present	Proposed
i.	Service Officers	₹21,000	₹31,500
iii.	JCO/ORs	₹14,000	₹21,000

This would be the ceiling for risk/hardship allowances and there would be no individual RHA with an amount higher than this allowance.

House Rent Allowance: Since the Basic Pay has been revised upwards, the Commission recommends that HRA be paid at the rate of 24 percent, 16 percent and 8 percent of the new Basic Pay for Class X, Y and Z cities respectively. The Commission also recommends that the rate of HRA will be revised to 27 percent, 18 percent and 9 percent respectively when DA crosses 50 percent, and further revised to 30 percent, 20 percent and 10 percent when DA crosses 100 percent.

In the case of PBORs of Defence, CAPFs and Indian Coast Guard compensation for housing is presently limited to the authorised married establishment hence many users are being deprived. The HRA coverage has now been expanded to cover all.

Any allowance not mentioned in the report shall cease to exist.

Emphasis has been placed on simplifying the process of claiming allowances.

Advances:

All non-interest bearing Advances have been abolished.

Regarding interest-bearing Advances, only Personal Computer Advance and House Building Advance (HBA) have been retained. HBA ceiling has been increased to ₹25 lakhs from the present ₹7.5 lakhs.

Central Government Employees Group Insurance Scheme (CGEGIS): The Rates of contribution as also the insurance coverage under the CGEGIS have remained unchanged for long. They have now been enhanced suitably. The following rates of CGEGIS are recommended:

	Present		Proposed
Level of Employee	Monthly Deduction  (₹)	Insurance Amount  (₹)	Monthly Deduction  (₹)	Insurance Amount  (₹)
10 and above	120	1,20,000	5000	50,00,000
6 to 9	60	60,000	2500	25,00,000
1 to 5	30	30,000	1500	15,00,000

Medical Facilities:

Introduction of a Health Insurance Scheme for Central Government employees and pensioners has been recommended.

Meanwhile, for the benefit of pensioners residing outside the CGHS areas, CGHS should empanel those hospitals which are already empanelled under CS (MA)/ECHS for catering to the medical requirement of these pensioners on a cashless basis.

  All postal pensioners should be covered under CGHS. All postal dispensaries should be merged with CGHS.

Pension: The Commission recommends a revised pension formulation for civil employees including CAPF personnel as well as for Defence personnel, who have retired before 01.01.2016. This formulation will bring about parity between past pensioners and current retirees for the same length of service in the pay scale at the time of retirement.

The past pensioners shall first be fixed in the Pay Matrix being recommended by the Commission on the basis of Pay Band and Grade Pay at which they retired, at the minimum of the corresponding level in the pay matrix.

This amount shall be raised to arrive at the notional pay of retirees, by adding number of increments he/she had earned in that level while in service at the rate of 3 percent.

In the case of defence forces personnel this amount will include Military Service Pay as admissible.

Fifty percent of the total amount so arrived at shall be the new pension.

An alternative calculation will be carried out, which will be a multiple of 2.57 times of the current basic pension.

The pensioner will get the higher of the two.

Gratuity: Enhancement in the ceiling of gratuity from the existing ₹10 lakh to ₹20 lakh. The ceiling on gratuity may be raised by 25 percent whenever DA rises by 50 percent.

Disability Pension for Armed Forces: The Commission is recommending reverting to a slab based system for disability element, instead of existing percentile based disability pension regime.

Ex-gratia Lump sum Compensation to Next of Kin: The Commission is recommending the revision of rates of lump sum compensation for next of kin (NOK) in case of death arising in various circumstances relating to performance of duties, to be applied uniformly for the defence forces personnel and civilians including CAPF personnel.

Martyr Status for CAPF Personnel: The Commission is of the view that in case of death in the line of duty, the force personnel of CAPFs should be accorded martyr status, at par with the defence forces personnel.

New Pension System: The Commission received many grievances relating to NPS. It has recommended a number of steps to improve the functioning of NPS. It has also recommended establishment of a strong grievance redressal mechanism.

Regulatory Bodies:  The Commission has recommended a consolidated pay package of ₹4,50,000 and ₹4,00,000 per month for Chairpersons and Members respectively of select Regulatory bodies. In case of retired government servants, their pension will not be deducted from their consolidated pay. The consolidated pay package will be raised by 25 percent as and when Dearness Allowance goes up by 50 percent. For Members of the remaining Regulatory bodies normal replacement pay has been recommended.

Performance Related Pay: The Commission has recommended introduction of the Performance Related Pay (PRP) for all categories of Central Government employees, based on quality Results Framework Documents, reformed Annual Performance Appraisal Reports and some other broad Guidelines. The Commission has also recommended that the PRP should subsume the existing Bonus schemes.

There are few recommendations of the Commission where there was no unanimity of view and these are as follows:

The Edge: An edge is presently accordeded to the Indian Administrative Service (IAS) and the Indian Foreign Service (IFS) at three promotion stages from Senior Time Scale (STS), to the Junior Administrative Grade (JAG) and the NFSG.  is recommended by the Chairman, to be extended to the Indian Police Service (IPS) and Indian Forest Service (IFoS).

Shri Vivek Rae, Member is of the view that financial edge is justified only for the IAS and IFS. Dr. Rathin Roy, Member is of the view that the financial edge accorded to the IAS and IFS should be removed.

Empanelment: The Chairman and Dr. Rathin Roy, Member, recommend that All India Service officers and Central Services Group A officers who have completed 17 years of service should be eligible for empanelment under the Central Staffing Scheme and there should not be “two year edge”, vis-à-vis the IAS. Shri Vivek Rae, Member, has not agreed with this view and has recommended review of the Central Staffing Scheme guidelines.

Non Functional Upgradation for Organised Group ‘A’ Services:The Chairman is of the view that NFU availed by all the organised Group `A’ Services should be allowed to continue and be extended to all officers in the CAPFs, Indian Coast Guard and the Defence forces. NFU should henceforth be based on the respective residency periods in the preceding substantive grade. Shri Vivek Rae, Member and Dr. Rathin Roy, Member, have favoured abolition of NFU at SAG and HAG level.

Superannuation: Chairman and Dr. Rathin Roy, Member, recommend the age of superannuation for all CAPF personnel should be 60 years uniformly. Shri Vivek Rae, Member, has not agreed with this recommendation and has endorsed the stand of the Ministry of Home Affairs.

The full report is available in the website, http://7cpc.india.gov.in.

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