Published On: Thu, Dec 8th, 2016

Higher Allowance – Government is in a fix when to issue notification

New Delhi: The Finance Ministry official involved with the process of higher allowances told The Sen Times on condition of anonymity that government is facing the classic dilemma on the subject of issuing of notification of higher allowances under 7th pay commission recommendations.

The Finance Minister Arun Jaitley is looking at all situations to normalize cash crunch to receive report on higher allowances.

He lamented that the 7th pay commission recommendations has been implement in August, which was made effective from January 1 for hike in basic pay, but has yet to implement higher allowances.

jaitley-arunThe Finance Ministry and the Prime Minister’s Office (PMO) are seeking to issue the notification of implementation of higher allowances shortly under the 7th pay commission recommendations.

On the other hand, the government is facing a dilemma over how to control cash crunch since the government’s decision to demonetise high-value currency notes.

As the demonetisation drive today completes 30 days, cash situation continues to stay critical in the country as evident by the unending queues outside banks and a few operational ATMs.

“The government dilemma in relation to issuing higher allowances notification will make to force central government employees to stand in long queues,” the official said on Thursday. “That is the dilemma, the government is trying to work through.”

“The committee on Allowances has finalized the proposal on the allowances but the government don’t need to it now,” the official said. “The government will decide to review all situation in respect of cash crunch and to look at it, the Finance Minister Arun Jaitley is looking at all situations to normalize cash crunch to receive report on higher allowances.”

The government constituted the committee on allowances in June headed by Finance Secretary Ashok Lavasa to examine the 7th Pay Commission recommendations on allowances, other than dearness allowance as the 7th pay commission had recommended of abolishing 51 allowances and subsuming 37 others out of 196 allowances.

While said delays by the Finance Ministry in issuing higher allowances notification, the official said, “the demonetisation drive is open till December 30, and the notification is likely to issue from January next, after the the cash crunch will ease.”

Existing allowances are now being paid to the central government employees according to the 6th Pay Commission recommendations until issuing of higher allowances notification.

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