Consumer Price Index for Industrial Workers (CPI-IW) – May, 2016
No. 5/1/2016 – CPI
GOVERNMENT OF INDIA
MINISTRY OF LABOUR & EMPLOYMENT
LABOUR BUREAU
`CLEREMONT’, SHIMLA-171004
DATED: 30th June, 2016
Press Release
Consumer Price Index for Industrial Workers (CPI-IW) – May, 2016
The All-India CPI-IW for May, 2016 increased by 4 points and pegged at 275 (two hundred and seventy five). On 1-month percentage change, it increased by (+) 1.48 per cent between April, 2016 and May, 2016 when compared with the increase of (+) 0.78 per cent between the same two months a year ago.
The maximum upward pressure to the change in current index came from Food group contributing (+) 3.69 percentage points to the total change. At item level, Rice, Wheat, Arhar Dal, Gram Dal, Masur Dal, Urd Dal, Groundnut Oil, Eggs (Hen), Fish Fresh, Milk, Chillies Green, Brinjal, Cabbage, French Bean, Potato, Tomato, Sugar, Petrol, etc. are responsible for the increase in index.
The year-on-year inflation measured by monthly CPI-IW stood at 6,59 per cent for May, 2016 as compared to 5.86 per cent for the previous month and 5.74 per cent during the corresponding month of the previous year. Similarly, the Food inflation stood at 8.48 per cent against 7.55 per cent of the previous month and 5.99 per cent during the corresponding month of the previous year.
At centre level, Salem reported the maximum increase of 12 points followed by Puducherry and Mysore (11 points each). Bengluru (10 points), Quilon, Warrangal and Coonoor (9 points each). Among others, 8 points increase was observed in 3 centres, 7 points in 5 centres, 6 points in 5 centres, 5 points in 9 centres, 4 points in 6 centres, 3 points in 9 centres, 2 points in 6 centres and 1 point in 17 centres. On the contrary, Amritsar recorded a decrease of I point. Rest of the 10 centres’ indices remained stationary.
The indices of 31 centres arc above All-India Index and other 42 centres’ indices are below national average. The indices of Pune, Salem, Vishakhapatnam, Bokaro and Varanasi centres remained at par with All-India Index.
The next issue of CPI-IW for the month of June, 2016 will be released on Friday, 29th July, 2016. The same will also be available on the office website www.labourbureaunew.gov.in.
7th Pay Commission – House Rent Allowance after Cabinet Approval
The 7th pay panel headed by AK Mathur had recommended that HRA should be rationalized by a factor of 0.8, the Commission also recommends that HRA should be rationalized to 24 percent, 16 percent and 8 percent of the Basic Pay for Class X, Y and Z cities respectively.
But, the Cabinet committee not taken any decision on the allowances part, so 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 reports within a period of 4 months. Till a final decision, all existing Allowances will continue to be paid at the existing rates
Existing HRA Rates :
Population
of Cities/Towns
Class
of Cities/Towns
HRA
rates as % of Basic Pay (including MSP and NPA)
50 lakh
and above
X
30
50–5
lakh
Y
20
Below 5
lakh
Z
10
Official Statement
The Commission examined a total of 196 existing Allowances and, by way of rationalization, 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 reports within a period of 4 months. Till a final decision, all existing Allowances will continue to be paid at the existing rates.”
House Rent Allowance comes under one of the 196 allowances, so there is no changes in the HRA for another 4 months
Has the 7th CPC recommendation fully accepted?
Yes, it has been approved by the cabinet on 29th June 2016.
Did Cabinet approve for the employees request of changing minimum wages?
No, the 7th CPC recommendation will be implemented (Rs.18000/-)
What is the Fitment Factor used in Pay Matrix?
A fitment factor of 2.57 will be applied across all Levels in the Pay Matrices.
When will I get my arrears?
All arrears including pensioner will be paid during this financial year (2016-17) itself.
What would be Rate of increment?
Rate of increment has been retained at 3 %. This will benefit the employees in future on account of higher basic pay as the annual increments that they earn in future will be 2.57 times than at present.
What would be the current House Building Advance?
The ceiling of House Building Advance from Rs.7.50 lakh to 25 lakh,
What would be my current Central Government Employees Group Insurance Scheme (CGEGIS)?
It will stay at the existing rate of Rs.30, Rs.60 & Rs.120/- for Group C, B & A respectively.
Has the old allowance has been abolished?
Currently No (June’2016). Existing will continue and after 4 month’s there may be changes.
What would be the HRA Percentage after Cabinet Decision?
HRA would be at the rate of 30, 20 & 10 percentage and after 4 month’s there may be changes.
What’s the status of NPS Implementation?
Cabinet decided to form two separate committee for looking into the issues.
Has there been any changes in Defence Pay Matrix?
Yes, there has been changes in 13A (Brigadier), Level 12A (Lieutenant Colonel), 13 (Colonel) and 13A (Brigadier).
Will there be any changes in Military Service Pay?
Yes, Rates of Military Service Pay revised from Rs. 1000, 2000, 4200 & 6000 to 3600, 5200, 10800 & 15500 respectively for various categories of Defence Forces personnel.
For pension, what would be multiplication factor?
2.57 would be the factor to determine the pension and will be reviewed after 4 months.
Go ahead with Indefinite Strike preparations – AIRF
AIRF
All India Railwaymen’s Federation
No.AIRF/160
Dated: June 29, 2016
The General Secretaries,
All Affiliated Unions,
Dear Comrades!
Sub: Cabinet approval on the VII CPC report
As all of you are aware that the Union Cabinet has accepted the report of the VII CPC today.
It has been noticed that there is no improvement in Minimum Wage and Multiplying Factor as well, which was our hard pressed demand. Instead, wages, as recommended by the VII CPC have been accepted as it is, which is highly disappointing.
Only two committees have been formed, one to take care of the allowances and another for National Pension Scheme, which will submit their reports within four months time.
It is quite unfortunate that, our demand for improvement in the report of the VII CPC has not been considered by the government.
Therefore, it would be quite appropriate that, we should go ahead with our preparations for “Indefinite Strike”, slated to be commended from 06:00 hrs. on 11th July, 2016.
You are also advised -to intensify the mass mobilization.
NJCA will meet on 30th June 2016 to decide future course of action – Confederation
7th Pay Commission Latet News
GOVERNMENT REJECTED ALL THE MODIFICATIONS SOUGHT BY THE NJCA
NO INCREASE IN MINIMUM PAY AND FITMENT FORMULA
HOLD PROTEST DEMONSTRATIONS & RALLY IN FRONT OF ALL OFFICES AND AT ALL IMPORTANT CENTRES
NJCA will meet at 04:00 PM on 30th June 2016 to decide future course of action. Continue in full swing mobilization for indefinite strike from 11th July 2016.
Cabinet approves Implementation of the recommendations of 7th Central Pay Commission
The Union Cabinet chaired by the Prime Minister Shri Narendra Modi has approved the implementation of the recommendations of 7th Central Pay Commission (CPC) on pay and pensionary benefits. It will come into effect from 01.01.2016.
In the past, the employees had to wait for 19 months for the implementation of the Commission’s recommendations at the time of 5th CPC, and for 32 months at the time of implementation of 6th CPC. However, this time, 7th CPC recommendations are being implemented within 6 months from the due date.
The Cabinet has also decided that arrears of pay and pensionary benefits will be paid during the current financial year (2016-17) itself, unlike in the past when parts of arrears were paid in the next financial year.
The recommendations will benefit over 1 crore employees. This includes over 47 lakh central government employees and 53 lakh pensioners, of which 14 lakh employees and 18 lakh pensioners are from the defence forces.
Highlights:
1. The present system of Pay Bands and Grade Pay has been dispensed with and a new Pay Matrix as recommended by the Commission has been approved. The status of the employee, hitherto determined by grade pay, will now be determined by the level in the Pay Matrix. Separate Pay Matrices have been drawn up for Civilians, Defence Personnel and for Military Nursing Service. The principle and rationale behind these matrices are the same.
2. All existing levels have been subsumed in the new structure; no new levels have been introduced nor has any level been dispensed with. Index of Rationalisation has been approved for arriving at minimum pay in each Level of the Pay Matrix depending upon the increasing role, responsibility and accountability at each step in the hierarchy.
3. The minimum pay has been increased from Rs. 7000 to 18000 p.m. Starting salary of a newly recruited employee at lowest level will now be Rs. 18000 whereas for a freshly recruited Class I officer, it will be Rs. 56100. This reflects a compression ratio of 1:3.12 signifying that pay of a Class I officer on direct recruitment will be three times the pay of an entrant at lowest level.
4. For the purpose of revision of pay and pension, a fitment factor of 2.57 will be applied across all Levels in the Pay Matrices. After taking into account the DA at prevailing rate, the salary/pension of all government employees/pensioners will be raised by at least 14.29 % as on 01.01.2016.
5. Rate of increment has been retained at 3 %. This will benefit the employees in future on account of higher basic pay as the annual increments that they earn in future will be 2.57 times than at present.
6. The Cabinet approved further improvements in the Defence Pay Matrix by enhancing Index of Rationalisation for Level 13A (Brigadier) and providing for additional stages in Level 12A (Lieutenant Colonel), 13 (Colonel) and 13A (Brigadier) in order to bring parity with Combined Armed Police Forces (CAPF) counterparts at the maximum of the respective Levels.
7. Some other decisions impacting the employees including Defence & Combined Armed Police Forces (CAPF) personnel include :
· Gratuity ceiling enhanced from Rs. 10 to 20 lakh. The ceiling on gratuity will increase by 25 % whenever DA rises by 50 %.
· A common regime for payment of Ex-gratia lump sum compensation for civil and defence forces personnel payable to Next of Kin with the existing rates enhanced from Rs. 10-20 lakh to 25-45 lakh for different categories.
· Rates of Military Service Pay revised from Rs. 1000, 2000, 4200 & 6000 to 3600, 5200, 10800 & 15500 respectively for various categories of Defence Forces personnel.
· Terminal gratuity equivalent of 10.5 months of reckonable emoluments for Short Service Commissioned Officers who will be allowed to exit Armed Forces any time between 7 and 10 years of service.
· Hospital Leave, Special Disability Leave and Sick Leave subsumed into a composite new Leave named ‘Work Related Illness and Injury Leave’ (WRIIL). Full pay and allowances will be granted to all employees during the entire period of hospitalization on account of WRIIL.
8. 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. In order to ensure that no hardship is caused to employees, four interest free advances namely 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.
9. The Cabinet also decided not to accept the steep hike in monthly contribution towards Central Government Employees Group Insurance Scheme (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. 1470. However, considering the need for social security of employees, the Cabinet has asked Ministry of Finance to work out a customized group insurance scheme for Central Government Employees with low premium and high risk cover.
10. The general recommendations of the Commission on pension and related benefits have been approved by the Cabinet. Both the options recommended by the Commission as regards pension revision have been accepted subject to feasibility of their implementation. Revision of pension using the second option based on fitment factor of 2.57 shall be implemented immediately. A Committee is being constituted to address the implementation issues anticipated in the first formulation. The first formulation may be made applicable if its implementation is found feasible after examination by proposed Committee which is to submit its Report within 4 months.
11. The Commission examined a total of 196 existing Allowances and, by way of rationalization, 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 reports within a period of 4 months. Till a final decision, all existing Allowances will continue to be paid at the existing rates.
12. 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.
13. Apart from the pay, pension and other recommendations approved by the Cabinet, it was decided that the concerned Ministries may examine the issues that are administrative in nature, individual post/ cadre specific and issues in which the Commission has not been able to arrive at a consensus.
14. As estimated by the 7th CPC, the additional financial impact on account of implementation of all its recommendations in 2016-17 will be Rs. 1,02,100 crore. There will be an additional implication of Rs. 12,133 crore on account of payments of arrears of pay and pension for two months of 2015-16.
Railway Union NFIR expressed serious disappointment over the Government’s decision on 7th Pay Commission minimum wage
The National Federation of Indian Railwaymen (NFIR)’s General Secretary expressed serious disappointment and unhappiness over the Government’s decision on minimum wage. Although there is justification of upward revision of minimum wage, the Government has not done justice to the employees. Similarly, the multiplier factor has not adequately been revised, Dr. Raghavaiah General Secretary NFIR said.
Dr. Raghavaiah further said that as already decided by the NJCA, Railway employees will go on strike from 6:00 AM of 11th July 2016.
The Cabinet on Wednesday approved a 23.6 per cent increase in government employees’ overall pay – basic pay plus allowances – as recommended by the 7th Pay Commission.
There were reports yesterday that the increase would be higher than what the Commission recommended, but that didn’t happen.
The Pay Commission’s recommendations are to be implemented retroactively, from January 1, 2016. The increase in the basic pay is 14.27 per cent and with the hike proposed in allowances, the rise in remunerations comes to 23.6 per cent. The pay hike will benefit 47 lakh central government employees and 52 lakh pensioners .
It’s estimated that the implementation of the new pay scales will put an additional burden of Rs 1.02 lakh crore annually on the exchequer. That comes to nearly 0.7 per cent of the GDP.
While the 2016-17 budget fiscal didn’t provide an explicit provision for implementation of the 7th Pay Commission, the government had then said that the once-in-a-decade pay hike for government employees has been built in as interim allocation for different ministries. That interim allocation amounts to Rs 70,000 crore
23.55% salary hike likely for central govt employees
Economic Times reported 23.55% Salary hike in the 7th Pay Commission
The much-anticipated Seventh Pay Commission bonanza for the government employees is likely soon with the Union Cabinet set to consider the panel’s recommendations on Wednesday.
The committee of secretaries tasked with reviewing the recommendations has given its report that would be considered by the government before deciding on the final award.
The Seventh Pay Commission has announced 23.55% increase in pay and allowances of serving central government employees and 24% increase in pension of retired officers.
A government official confirmed that the proposal is on the cabinet agenda for Wednesday.
The total outgo if this award is implemented from January 1, 2016, is pegged at Rs 1.02 lakh crore, providing a bid demand boost to the economy.
However, in view of fiscal constraints, the government is likely to go for a lower increase and also delay the implementation of the increase in allowances.
In the budget for FY17, the government has budgeted 32% increase in salary of its employees but only a meagre 1.9% rise in allowances.
Finance ministry officials have said that the budget has adequate provision for pay commission and the fiscal deficit target of 3.5% of GDP will not be under stress from implementation of the award.
In a report after the budget, Moody’s had said “Pay Commission recommendations of a 24% hike in public sector salary, allowances and pensions, is not fully accounted for in the budget” and will be a source of spending pressure.
The government can delay the implementation of increase in allowances to a later date but the salary increases will have to be given from January 1, 2016, which means employees will get arrears for these month, a potential boost to economy.
Car and property sales tend to rise after pay commission awards.
Cabinet may decide on 7th Pay Commission on June 29
The much awaited seventh pay commission is going to enter the last phase of implementation soon.
The Union Cabinet is expected to take up the recommendations of the 7th Pay Commission on June 29.
As per reports, Prime Minister has directed Finance Ministry to implement the Pay Commission for government employees, and place the Empowered Group of Secretaries report on the central government employees’ salary and allowances hike in the next Cabinet meeting on Wednesday, June 29.
It is expected that Empowered Group of Secretaries panel has raised the fitment factor to around 2.7, up from 2.57 as recommended by the 7th Pay Commission. The entry level salary is expected to rise to Rs 23,000, up from Rs 18,000 as recommended by the AK Mathur panel. Implementation of the Pay Commission report is going to cost the government Rs 1.02 lakh crore.
The Commission will revise the pay of nearly 47 lakh central government employees and 52 lakh pensioners, which will be effective from January 1, 2016.
With the threat of strike by central government employees looming large, the Cabinet is expected to take a prompt decision on the recommendations resulting in notification.
The salary hikes recommended are expected to apply from July.
