Central government employees, who have been waiting for higher allowances as the recommendations of the 7th Pay Commission, should not be worried as the government will be in a position to implement the 7th CPC recommendations, thanks to demonetisation. The demonetisation of old Rs 500 and Rs 1000 currency notes that caused cash shortage has made central government employees little anxious, but report by BofA Merrill Lynch Global Research and statement of Reserve Bank of India Governor Urjit Patel will bring smile on their faces.
“The
Government announced that the second income disclosure scheme (IDS II) will run
till March 31. We continue to estimate that it will net the fisc about
Rs1000bn/0.7% of GDP of additional taxes. This should allow Finance Minister
Jaitley to hold the FY18 fiscal deficit at 3.5% of GDP – same as FY17’s – and
at the same time fund the 7th Pay Commission and recapitalize PSU banks, without
cutting back on public capex,” BofA Merrill Lynch said in a note. Earlier, the
RBI had made clear that the implementation of the 7th Pay Commission
recommendations for central government employees won’t have an inflationary
impact.
Earlier
we reported that the central government employees will have to wait til March,
2017 to get their higher allowances under the 7th Pay Commission
recommendations. Centre is planning to pay higher allowances without arrears.
Sources in the Finance Ministry also said the Centre is considering to hike
higher allowances for its employees. However there is no report about when the
government will start paying higher allowances as recommended by the 7th
Central Pay Commission.
The
issue of higher allowances has been referred to the ‘Committee on Allowances’.
The committee is yet to submit its report. Until acceptance of higher
allowances, under 7th Pay Commission, the allowances are now paid according to
the 6th Pay Commission recommendations.
Source
: http://www.india.com/
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