Budget 2023: 7th Pay Commission: What were the key changes implemented? Minimum, maximum pay, matrix, gratuity, Dearness Allowance, increment, other key highlights

Budget 2023, 7th pay commission: Since India got its Independence, the Government has set up Pay Commissions to recommend changes in salary structure of central government employees.

So far, seven pay commissions have been set up and the last pay commission recommendations were approved in the year 2016, when the former Finance Minister Arun Jaitley had said that the time has come to raise employees' salaries every year. 

Read more: Changes likely in the 7th pay commission in the budget 2023

A pay commission analyzes and reviews the current income system and provides recommendations for changes towards pay, benefits, and other perks for both civil employees and the armed forces.Additionally, it evaluates the standards for bonuses while taking into account the productivity and performance of the workforce. A pay commission additionally looks at the current pension plan and other retirement benefits.

Employees and staffers of the Central Government in India receive their pay according to the 7th Pay Commission System. 

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Key Highlights of 7th pay commission 

- Minimum pay decided

According to the 7th pay commission, the newly-recruited central government employee salary was decided at Rs 18,000 per month, as per 7th pay commission. On the other hand, a freshly recruited class 1 officer will receive Rs 56,100 as monthly emolument.

- Maximum pay decided 

The Seventh Pay Commission had set the maximum pay for government employees to Rs 2.25 lakhs per month for Apex Scale, and Rs 2.5 lakhs per month for Cabinet Secretary and others working at the same level.

- New Pay Matrix 

Several Pay Matrixes for different groups such as Defence Personnel, Civilians, Military Nursing Services were introduced under 7th pay commission.

- Gratuity

The Gratuity ceiling was decided at Rs 20 lakh under the 7th pay commission. Further, when DA rises by 50 per cent, the ceiling of Gratuity will also be enhanced by 25 per cent.

- Military Service Pay

Under 7th Pay Commission rates were revised of Military Service Pay personnel involved in different categories of Defence Forces.

- Work Related Illness and Injury Leave (WRIIL): 

The Pay Commission had given full pay and allowances to all central government employees who are hospitalised due to WRIIL.

- Fitment

The 7th Pay Commission had decided a uniform Fitment Factor of 2.57 for all employees.

- Dearness Allowance (DA)

The commission had increased the DA under the 7th pay commission.

- Annual increment: 

The Pay Commission had decided the annual increment of 3 per cent p.a.

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7th pay commission matrix chart 

1. Grade Pay 1800 to 2800 - Level 1 to Level 5

PB-1 (5200 to 20200)