Indian Economy : Seventh Pay Commission Report - Developments, Issues and Concepts

Part-1

1) The central government has accepted most of the recommendations of Seventh Central Pay Commission (7th CPC).  Which of the following statements is/are correct in this regard?

a) Minimum entry level pay at the lowest level has been raised to Rs 18,000/- a month.
b) Minimum starting salary for a freshly recruited class-1 officer has been raised to Rs 56,100/- a month.
c) Both a and b
d) Neither a nor b

2) Which of the following statements is/are correct with respect to the new "gratuity ceiling" for central government employees?

a) Gratuity ceiling has been increased to Rs 12.5 lakh/-.
b) Rate of increment is retained at 3%.
c) Both a and b
d) Neither a nor b

3) Which of the following leaves has/have been subsumed under 'Work Related Illness and Injury Leave (WRILL)'?

a) Hospital leave
b) Special disability leave
c) Injury leave
d) All of the above

4) The central government has restructured some of the provisions of existing pay system. Which of the following statements is/are correct in this regard?

a) A new 'Pay Matrix' will replace existing system of 'Pay Bands and Grade Pay'.
b) Except 4 interest-free advances - medical treatment, tour/transfer, for family of deceased employees and travel concessions, all other advances have been abolished.
c) Both a and b
d) Neither a nor b

5) Which of the following could be the impact/impacts of 23.5% hike in salary for central government staff on the Indian economy?

a) Rise in inflation through direct or indirect channels.
b) Rise in consumption through increased spending from higher wages.
c) Pay hike along with capital expenditure by the government will push economic growth.
d) All of the above.

6) Which of the following authorities approves the constitution of the Central Pay Commission(CPC) in India?

a) Prime Minister
b) President
c) Finance Minister
d) Cabinet Secretary

7) Which of the following statements is incorrect with respect to Central Pay Commission(CPC)?

a) It is a statutory body.
b) It is constituted by the Prime Minister of India.
c) CPC gives its recommendations to Finance Minister of India.
d) Seventh CPC is headed by retired Supreme court judge, justice Alok Kumar Mathur.

Answers

1) c
2) b, Gratuity ceiling has been increased to Rs 20 lakh.
3) d
4) c
5) d
6) a
7) a, Neither statutory nor constitutional .

Note: Recommendations of CPC is applicable for central government employees and pensioners only. State governments usually sync the salary structure of their employees with their central counterpart.

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Part-2

1) Which of the following statement is incorrect with respect to 'occupational structure' under central government?

a) The central government employs 8.5% of India's organized workforce.
b) The central government's share in organized sector employment has gradually risen over the past 15 years.
c) The Armed Forces are the country's biggest employer.
d) Defence personnel constitute largest share among pensioners followed by railways.

Answers

1) b, The central government's share in organized sector employment has gradually fallen over the past 15 years.