Economy

Pay Commission report will have no immediate impact on inflation: Rae

Our Bureau New Delhi | Updated on January 22, 2018 Published on November 19, 2015

Vivek Rae, Member, Seventh Pay Commission





In a quick chat with BusinessLine after the Seventh Pay Commission submitted its report to the Finance Minister, Commission Member Vivek Rae shares his thoughts on the report. While Rae is all for a performance-linked assessment for government employees, he also favours maintaining the edge which IAS and IFS have over other services.



Has the Commission stuck to the same old formula to derive the basic salary or is there any change? Do you see any inflationary impact if the recommendation is accepted?

We have not changed the formula. It is the same old Aykroyd formula which has been in use since 1957.

It is broadly based on the nutritional intake of a family of four and use of essential commodities. We have gone brick-by-brick on it. I do not see any major impact on food inflation.

Have you factored in OROP while considering the revision in salaries for service officers?

No, we could factor in OROP as it was notified much later, by which time we had already firmed up the recommendations and it had gone for print. The pension has been considered in totality.

On contractual employees, the report just states that a clear guidance from the government on jobs that can and should be contracted out will be appropriate. Is there any recommendation made by the Commission?

We have not touched upon contractual employees. They will be treated like what has been suggested in the Sixth Pay Commission.

While you have endorsed performance-linked hikes, you have given a dissent note for a suggestion that the edge which IAS and IFS enjoys should be extended to all services. What is your rationale?

IAS and IFS have remained the premium service since the beginning. For the first 13 years or so of service IAS officers face tough situations. This time three different members have different views. There is no unanimity.

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Published on November 19, 2015
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