Last Updated: January 24, 2023, 12:44 IST
There are two incentives available for government employees in the Union Budget 2023 to be announced on February 1. As per sources in the finance ministry, the budget’s fitment factor for employee salaries may alter and the House Building Allowance (HBA) advance may also be raised from Rs 25 to Rs 30 lakh. It is the final budget of the Narendra Modi administration before the 2024 elections.
The current value of the common fitment factor is 2.57%. In other words, if a person receives a basic salary of Rs 15,500 in the 4200 Grade Compensation, his total pay will be Rs 15,500 x 2.57, or Rs 39,835. The fitment ratio of 1.86 has been suggested by the 6th CPC.
Employees are now reportedly requesting the government to increase the fitting factor to 3.68. The increase will bring the minimum salary up to $26,000 from its present level of Rs 18,000.
On February 1, Finance Minister Nirmala Sitharaman will deliver the Budget Speech and the Budget 2023. Beginning on January 31, Parliament will hold its budget session.
A report by Moneycontrol claims that the 7th Pay Commission’s proposed compensation modification is the subject of ongoing debate. According to sources, the pay commission will have the option to adjust central government employees’ salaries using the fitment factor. The government thinks that instead of increasing salaries every ten years, they should do so annually. This will make it possible for the employees holding lower-level positions to receive the same pay as the officers holding higher-level positions.
Former Finance Minister Arun Jaitley proposed raising staff salaries annually. In 2016, when the 7th Pay Commission was approved, Jaitley stated that it was time to raise staff salaries annually. The personnel at the entry level will gain from this. It is expected that the government may include a new formula for employee salary revision in the budget. The annual salary increase scheme will be used in the 2024-25 budget.
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