Seventh CPC: Approach for simplification and rationalisation

The Seventh CPC like other Pay Commissions had been entrusted with the responsibility of evolving pay structures which were rational and simple.It was expected that the pay packages offered should be able to attract best talent in civil and defence services and also be capable of ensuring  performance related efficiency while taking note of  the existing socio political setup in the country.The pay structure should ensure value addition to services by talent of individual employees.

While discussing the pay structure for civilian employees the report explains the evolution of compression ratio to present level.Compression ratio is the ratio between the lowest pay  and the highest salary drawn by Secretary to Govt. of India in the pay structure.At the time of first CPC the ratio was 1:36.4(min Salary of ₹ 55 against highest of ₹ 2000.) .This came down to 1:11.4 in sixth CPC (min Salary of ₹ 7000 against highest of ₹ 80000).

There were several innovations brought about by  VI CPC which included running pay bands for both Civilians as well as Defence forces as well as  the introduction of the concept of Grade Pay as a level differentiator besides  calculation of the annual increment on percentage basis.Sixth CPC had also recommended abolition of Gr.D category posts by elevation of present incumbents to Gr.C by skill upgradation.It reduced 35 pay scales of Vth CPC to 23 (19 Pay bands +4 fixed pay levels).

However the Seventh CPC was confronted by stakeholders with several inconsistencies in Pay bands and Grade Pay structures and anomalies in Entry pay  recommended by Sixth CPC at various level . This  scenario had lead to demand for a fitment factor which may cover all cases in equitable fashion.

The recommendations of Seventh CPC are for abolishing the system of Pay Bands and Grade Pay and creation of  new functional levels  by merging the grade pay with the pay in the pay band. Commission said that it has ensured that all of the existing levels have been subsumed in the new structure; and no new level has been introduced nor has any existing level been dispensed with.The Seventh CPC has recommended a Pay matrix with distinct Pay Levels. The Level would henceforth be the status determiner as per table given below:

Pay Levels as per Pay Matrix

The Commission  has pointed out that  with this methodology of pay fixation “..any new entrant to a service would wish to be able to make a reasonable and informed assessment of how his/her career path would traverse and how the emoluments will progress alongside. The new pay structure has been devised in the form of a pay matrix to provide complete transparency regarding pay progression.”

In addition to the pay matrix the CPC has also applied concept of rationalisation of entry pay to take care of uneven pattern of  a jumps in the career hierarchy under existing pay scales in the Government of India. This system is based on the premise that with enhancement of levels from Pay Band 1 to 2, 2 to 3 and onwards, the role, responsibility and accountability increases at each step in the hierarchy.

Rationalistion table.png

The  pay matrix as suggested by CPC is intended to  replace  existing system of Pay Bands and Grade Pay.The pay matrix comprises of two dimensions. ” It has a “horizontal range” in which each level corresponds to a ‘functional role in the hierarchy’ and has been assigned the numbers 1, 2, and 3 and so on till 18. The “vertical range” for each level denotes ‘pay progression’ within that level. These indicate the steps of annual financial progression of three percent within each level.”

The Commission has devised the pay matrix by calculating the sum of Basic pay and Grade Pay at various stages and multiplying the sames of  by a multiplication factor of 2.57 . While devising the pay matrix the entry pay has been calculated by adopting different multiplication factors (shown as index in table below) for different pay bands depending on respective functional responsibilities.Pay Matrix is given below.

Pay Matrix

Pay Matrix 2

The following methodology has been suggested for fitment:

“The fitment of each employee in the new pay matrix is proposed to be done by multiplying his/her basic pay on the date of implementation by a factor of 2.57. The figure so arrived at is to be located in the new pay matrix, in the level that corresponds to the employee’s grade pay on the date of implementation, except in cases where the Commission has recommended a change in the existing grade pay. If the identical figure is not available in the given level, the next higher figure closest to it would be the new pay of the concerned employee. “

The CPC report has given some working examples for calculation.Having had a brief insight into Civilian Pay Scales we shall take up Army Pay Scales shortly.


Sixth CPC Report (ix): Central Services Gr A:(i)

Central Group A Services comprise of Organized and General Group A Services. The Organized Services cover Technical, Non Technical, Medical and other Services including Scientific Services. Taking an overview of the organisational structures the Commission has taken note of the fact that the pyramidical structure of the hierarchy in these services restricts the pace of upward mobility at the top stages leading to stagnation at Higher and Senior Administrative Grades (SAG/HAG) despite of several instances of cadre review and restructuring and consequential induction of several senior level posts in these organizations.

An important recommendation for taking care of this difficulty is for decadring of 20% of the posts in SAG and above ranks by all recognized services which would be allowed be filled up by Govt from any source . The Services would in turn be allowed to operate equal number of non functional posts in Senior or Higher Administrative Grades  to be filled up with officers with minimum length of service as per the laid down procedure. Benefit for promotion to HAG shall be available from 1st January of the year when promotion became due irrespective of the date of DPC. On regular posts being available the officer could be inducted there in without any further procedural delays.

The major demands from Central Services before the Sixth CPC related to parity with IAS, better entry grades scales  and  allocation of posts under Central Staffing Pattern in fair proportion and through a transparent process. Against this demand the Commission has recommended restriction of gap in batchwise parity in Central appointments to the extent of 2 years only. In practical terms this implies that on posting of an IAS officer of a particular batch to a particular grade pay in pay bands PB-3 or 4  in Center, non functional pay scale of higher nature  should be made available to Central Services officers with seniority higher by two years or more as personal scale. The officers would however get substantive postings when vacancies are available. Also for promotion to SAG common policy is recommended to be followed by all the Central Services in order to remove disparities. In order to ensure fair play in process of selection for SAG posts the involvement of UPSC has been recommended. Above measures are expected to remove the  anomalies in career advancement prospects in these Services.

Responding to the demand for higher pay package at the entry grade the Commission has increased the same uniformly for all the Central Services on pattern of All India Services. It has however not agreed to cadre review or restructuring for any service. These are the common issues. Individual service specific recommendations covered  in the next post.