7th CPC has erred in fixation of the minimum wage by adopting the wrong prices, and methodology – COC Karnataka
16th March Strike Importance
The main demands of the Staff Side (JCM) which led to declaration of the 11th July strike is the revision of the NPS, minimum wage, fitment formula, allowances and pension cases etc. this is due to lowest wage hike of just 14% recommended by the 7th CPC.
Under the 7th Pay Commission slab – which was implemented ten years after the previous pay commission the salaries of the government employees saw a marginal rise of just 14% . The basic pay under the 7th CPC the minimum wage was increased to Rs 18,000 from Rs 7,000 (2.57 times) while the salary of the senior government officials has gone up to Rs 2.50 lakh from Rs 90,000(2.77 times).
The minimum wage was increased by 2.57 times but in actual terms this increase is of just Rs 2250/- in 7th CPC, while taking into account of 125% DA was merged this due to rising inflation and price rise already the CG employees wage factor was 2.25 time, that is basic of Rs 7000/- plus DA of 125% of Rs 8750 works out to Rs 15750/- , staff side had already demanded for a hike of more than three times which is Rs 26,000 per month.
Comparison of earlier wage hike we can observe that the fitment factor of 2.57 times is the lowest comparing to other pay commissions. If we make a study of earlier pay commission.
|Pay Commission||Year||Minimum wage old||Minimum wage revised||Increase|
|2nd CPC||1959||Rs 55/-||Rs 80/-||1.45 times|
|3rd CPC||1973||Rs 80/-||Rs 196/-||2.45 times|
|4th CPC||1986||Rs 196/-||Rs 750/-||3.82 times|
|5th CPC||1996||Rs 750/-||Rs 2550/-||3.40 times|
|6th CPC*||2006||Rs 2550/-||Rs 7000/-||2.74 times|
|7th CPC *||2016||Rs 7000/-||Rs 18000/-||2.57 times|
* The minimum qualification required at lower level appointments from the year 2008 has been revised from 8th pass to 10th pass (SSLC) as per the 6th CPC recommendations, hence the minimum wage should increase by 25% compared to earlier pay commissions.
The minimum wage has increased considerably due to price inflation from 4th CPC (1986) onwards the average wage hike is 3.32 times. During the period 1946 to 1972, the financial position of the Central Government was not that good. The financial position of the Central Government has been improving from the 4th CPC onwards that is from 1986 onwards, the pay fixation depends on the paying capacity of the Central Government. The revenue collection of the Central Government has increased especially from last few years. The revenue expenditure in respect of salaries of Central Government employees is just under 10% of the Central Government revenue. In respect of the many State Governments the revenue expenditure towards salaries is around 20%. Whereas the Central Government is spending just 10% of the revenue collection on salary head.
The wages of CG employees are determined based Dr. Aykroyd formula, the Staff Side (JCM) has calculated minimum wage as on 1st Jan 2014 as per the Dr. Aykroyd formula as Rs 26,000/- taking into market prices. Even if we adopt the retail prices of The Directorate of Economics & Statistics Department of Agriculture & Cooperation Ministry of Agriculture Government Of India New Delhi of the month of July 2016 the minimum wage works out to Rs 24,000/ which is 3.42 times increase. The 7th CPC has also adopted Dr. Aykroyd formula for the computation of the minimum wage and fixed at Rs 18000/- and thereafter the fitment formula is calculated.
Fitment formula = Minimum wage Rs 18000 / Rs 7000 = 2.57
The Staff Side (JCM) had demanded the fitment formula of 3.72 that is Rs 26000/ Rs 7000 as on 1st Jan 2014. Whatever angle we look the 7th CPC has cheated us on the minimum wage and fitment formula compared to the earlier pay commission this pay commission has given us the lowest wage hike of just 14% compared to last 40 years.
Meanwhile, some reports suggest that the employees who have been eagerly waiting for higher allowances under the 7CPC will have to bear three more months of delay to get their allowances revised . Due to early Budget which is followed by Assembly Elections in five states, due to which model code of conduct has been imposed, the government is likely to delay the payment of the higher allowances. The polling in five states – Uttar Pradesh, Punjab, Uttarakhand, Goa and Manipur – will begin on February 4 and the results will be declared on March 11, after that only our allowances will be decided.
The financial position of the Central Government is very good. Even the GDP (Gross Domestic Product) has shown increase in last few years which is around 7% , the Indian economy is fastest growing and placed 7th in the world ( which is at 2,250.987 billions of $ ), comparing to wages paid in the world our wages are at lower level. The Government fiscal budget deficit equal to 3.50 percent of the country’s Gross Domestic Product in 2016. Compared to 2008 where the fiscal deficit was at 7.8 %, but today the fiscal deficit is contained at 3.5%. This is also a healthy sign of the economic status of the Central Government financial status, the budget fiscal deficit is always below 4%.
The Central Government financial position is very good even after demonetization, only a political decision the Central Government on our demands. Comrades the Hon’ble Finance Minister has given a given a press statement in media channel’s that the effect of demonetisation has not taken place on the revenue collection of the union government, in fact that the revenue collection has increased, even the revenue of the State Governments has increased considerably, the press release of the Ministry of Finance on 9/1/2017 has endorsed the Hon’ble Finance Minister statement.
To avert the 11th July CG employees strike the Hon’ble Prime Minster had instructed the group of ministers including Shri Rajnath Singh, Hon’ble Home Minister, Shri Suresh Prabhu , Hon’ble Railway Minister and Shri Arun Jaitely , Hon’ble Finance Minister to hold discussions with the Staff Side (JCM) on 30th June 2016 and the Shri Arun Jaitely , Hon’ble Finance Minister had published a written assurances in the Government website on 6th July 2016 leading to deferment of the strike .
Now comrades seven months has passed the assurances given by the group of ministers has not been fulfilled so far, in this connection the NJCA met on 17th January 2017 at New Delhi. The Confederation was represented by Comrades KKN Kutty, M Krishnan and MS Raja. Comrades RN Parashar and Giriraj Singh represented NFPE (constituent of Confederation).
Com. Shiva Gopal Mishra Staff Side Secretary (JCM) and Com M. Raghavaiah, Chairman Staff Side (JCM) had a meeting’s with the Cabinet Secretary and Shri Rajnath Singh, Hon’ble Home Minister on 18th Jan 2017 regarding the demands of the CG employees as assured by the group of ministers on 30th June 2016.
Shri Rajnath Singh, Hon’ble Home Minister had once again assured that the issues of CG employees will be resolved, but no time frame has been fixed for resolving the issues or any concrete assurances are given on our demands .
The strike is the last resort for achieving our demands, but we are forced to undertake the strike action due to following events.
1) The 7th CPC has erred in fixation of the minimum wage by adopting the wrong prices, and methodology. Thereby the minimum wage and fixation formula has to be corrected.
2) The Government has assured our staff side leaders that they will settle the demands of CG employees in four months’ time, but seven months has lapsed till now the demands of CG employees are not settled even allowances issue is also not settled so far.
3) Comrades , now the revenue collections of the Central Government has increased , the Central Government has financially capable to accept our demands of revision of allowance, minimum wage, fitment formula etc., revision of tax slabs should also take place , the Central Government employees should benefit as we were serving with dedication the Central Government and Central Government is a model employer.
Comrades Central Government has now take a political decision on our demands of revision of allowance, minimum wage, fitment formula and revision of tax slabs.
For this we have to struggle and put pressure on the Central Government to accept our demands. In this circumstance, it should be our endeavor to campaign more vigorously for the successful strike on 16th March 2017