IAS Prelims 2017 Important Topics on Current Affairs: Pay Commission of India

IAS Prelims 2017 Important Topics on Current Affairs: Pay Commission of India

IAS Prelims 2017 Important Topics on Current Affairs: The Union Public Service Commission (UPSC) will conduct the civil services (CS) preliminary examination on June 18 this year. It is one of the most esteemed and toughest exams in the country. With a success rate of 0.1- 0.3 percent of the total percentage of candidates who apply, it is really difficult to nail the examination.

As you know, On 28th March 2017, we have shared IAS Prelims 2017 Important Topics on current affairs which will help you prepare for your upcoming examination. Here is the topic that we have discussed on 7th April, Click on the link below to explore

IAS Prelims 2017 Important Topics on Current Affairs: Law of Commission of India

As promised, today we are going to continue with the ninth topic i.e Pay Commission of India. Let us provide you the brief explanation of the said topic.


IAS Prelims 2017 Important Topics on Current Affairs: Pay Commission of India

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Let us provide you the explanation of the given topic.

Pay Commission of India

Pay Commission is set up intermittently by Government of India, and gives its recommendations regarding changes in salary structure of its employees. Since India’s Independence, seven pay commissions have been set up on a regular basis to review and make recommendations on the work and pay structure of all civil and military divisions of the Government of India. Headquartered in Delhi, the Commission is given 18 months from date of its constitution to make its recommendations.


Examine, review, evolve and recommend changes that are desirable and feasible regarding the principles that should govern the emoluments structure including pay, allowances and other facilities/benefits, in cash or kind, having regard to rationalization and simplification therein as well as the specialized needs of various Departments, agencies and services, in respect of the following categories of employees:—

(i) Central Government employees—industrial and non-industrial;

(ii) Personnel belonging to the All India Services;

(iii) Personnel of the Union Territories;

(iv) Officers and employees of the Indian Audit and Accounts Department;

(v) Members of the regulatory bodies (excluding the RBI) set up under the Acts of Parliament; and

(vi) Officers and employees of the Supreme Court

Let us provide you a brief view of all the pay commission of india

First Pay commission

The first pay commission was established on January, 1946 and it submitted its report in May, 1947 to the interim government of India. It was under the chairmanship of Srinivasa Varadachariar. The mandate of 1st (nine members) was to examining and recommending emolument structure of Civilian employees.

Second Pay Commission

The second pay commission was set up in August 1957, 10 years after independence and it gave its report after two years. The recommendations of the second pay commission had a financial impact of ₹ 39.6 crore. The chairman of the second pay commission was Jagannath Das.The second pay commission reiterated the principle on which the salaries have to be determined.

Third Pay Commission

The third pay commission set up in April 1970 gave its report in March 1973 i.e. it took almost 3 years to submit the report, and created proposals that cost the government ₹ 144 crore. The chairman was Raghubir Dayal. The third pay commission (3CPC) added three very important concepts of inclusiveness, comprehensibility, and adequacy for pay structure to be sound in nature. The third pay commission went beyond the idea of minimum subsistence that was adopted by the first pay commission.

Fourth Pay Commission

Constituted in June 1983, its report was given in three phases within four years and the financial burden to the government was ₹ 1282 crore. This commission has been set up on dated 18.3.1987, Gazette of India (Extra ordinary) Notification No 91 dated 18.3.1987, The chairman of fourth pay commission was P N Singhal.

Fifth Pay Commission

The notification for setting up the Fifth CPC was issued on 9 April 1994, but started functioning only on 2 May 1994, with the assumption of charge by the Member Secretary. The chairman of fifth pay commission was Justice S. Ratnavel Pandian. the members were: Suresh Tendulkar, Professor Delhi school of Economics; and M.K Kaw, Indian Administrative Service. In comparison, First CPC had nine members including military members, the second had six members including a military member, the 3 CPC and 4 CPC had five, but no military member. The fifth had three members, but no military memberThe first had no member secretary, just a secretary. After the 1 CPC all pay commissions have had a member secretary, and invariably from the IAS.

Sixth Pay Commission

This commission has been set up under Justice B.N.Srikrishna with a timeframe of 18 months. The cost of hikes in salaries is anticipated to be about ₹ 20,000 crore for a total of 5.5 million government employees as per media speculation on the 6th Pay Commission, the report of which is expected to be handed over in late March/early April 2008.

Seventh Pay Commission

The Government of India has initiated the process to constitute the 7th Central Pay Commission along with finalisation of its Terms of Reference, the composition and the possible timeframe for submission of its Report. On September 25, 2013 then Finance Minister P Chidambaram announced that Prime Minister Manmohan Singh has approved the constitution of the 7th Pay Commission. Its recommendations are likely to be implemented with effect from January 1, 2016. Justice A.K Mathur headed the Seventh Pay Commission, announcement of which was done on 4 February 2014.

7th Pay Commission recommendations
  • In relation to an employee, the Commission proposed to increase (i) the minimum salary to Rs 18,000 per month, and (ii) the maximum salary to Rs 2, 50,000 per month.
  • It also recommended moving away from the existing system of pay bands and grade pay, which is used to determine an employee’s salary. Instead, it proposed a new pay matrix which will take into account the hierarchy of employees, and their pay progression during the course of employment.
  • The Commission also suggested that this matrix should be reviewed periodically, with a frequency of less than 10 years.
  • The Pay Commission also suggested a linkage between performance and remuneration of an employee. For this, it proposed the introduction of performance related pay which will be based on an annual appraisal of the employee.
  • In addition, it recommended that annual increments of an employee should be withheld, if he is unable to meet the benchmark required for regular promotion or career progression.
  • The Commission also sought to abolish or merge some of the allowances that may be given to employees by various government departments. It suggested that, of the 196 allowances that exist, 52 should be abolished and 36 should either be merged under existing heads, or be included under proposed allowances. Some of these allowances involved payment of a meagre amount of close to Rs 100 per month.
  • In addition, the rates of House Rent Allowance (HRA) were revised. The Commission proposed a methodology to increase the HRA rates every time the Dearness Allowance given to employees increased to 50% or 100%. Dearness Allowance is given to employees in lieu of increases in the cost of living, on account of inflation.
  • The Commission had also proposed a new methodology for computing pension for pensioners who retired before January 1, 2016. This is aimed at bringing parity between past and current pensioners. As part of the new methodology, two options for calculation of pension have been prescribed, and the pensioner may opt for either one.

Over here we conclude our article on IAS Prelims 2017 Important Topics on Current Affairs. Stay tuned with us for the rest of the topic that we will discuss day by day. 

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