As per the reports coming in, the Cabinet on Wednesday has approved 14.27 per cent hike in basic pay as recommended by the 7th Pay Commission. There were reports yesterday that the increase would be higher than what the Commission recommended, but as per reports that didn't happen.
The overall benefit will be 23.6 per cent hike overall pay taking basic pay plus allowances into consideration.
The Pay Commission's recommendations are to be implemented retroactively, from January 1, 2016. The increase in the basic pay is 14.27 per cent and with the hike proposed in allowances, the rise in remunerations comes to 23.6 per cent. The pay hike will benefit 47 lakh central government employees and 52 lakh pensioners.
It's estimated that the implementation of the new pay scales will put an additional burden of Rs 1.02 lakh crore annually on the exchequer. That comes to nearly 0.7 per cent of the GDP.