New Delhi: Government employees, get ready to hear the first word on the much-awaited pay hike!
While the Sixth Pay Commission is yet to finalise its report and it's likely to come in only in April, Union Finance Minister P Chidambaram is expected to provide the first indications on the Union Budget on Friday as to what kind of a pay increase is on the cards for the 40 lakh government employees.
The government on Wednesday said the Sixth Pay Commission would submit its report by April 4.
The Railway Budget has made an ad hoc provision of Rs 5,000 crore for 2008-09 to meet additional liability towards employees and pensioners in anticipation of the Pay Commission recommendations. The Union Finance Minister is also going to announce a similar provision in the Union Budget.
Reading from the Railway Budget provision of Rs 5,000 crore for 14 lakh employees on an estimated current outgo of Rs 46,379 crore, analysts say the pay hike for the government employees could be in the order of 20-25 per cent.
This calculation, however, doesn't factor in the arrears and pensions, which are going to be paid with retrospective effect from January 1, 2006.
Union Minister of State for Finance P K Bansal has, however, dismissed these calculations as speculative. “The commission is yet to finalise and submit its report, so the information doing the rounds in media might be speculative,” he says.
Commission Deputy Chairman Montek Singh Ahluwalia is, however, talking of a 'big increase' in the pay of government employees. The government, he said on Wednesday, is made to effect a big increase in salaries of its employees at the end of 10 years as the dearness allowance (DA) does not adequately take care of inflation.
"So at the end of 10 years, the government will be benefiting from a squeeze in real pay because the DA was never enough... so you have a big increase," he says.
Once the Pay Commission report is submitted, the state governments too will be under pressure to revise the salaries of state employees.
The Centre has so far remained non-committal about the exact date of implementation of the Pay Commission recommendations. "Since the report is yet to be submitted, the timeframe for its implementation cannot be stated," Bansal says.
The minister, however, says the commission is examining the desirability and need to sanction any interim relief till the time its recommendations are made.
The Sixth Pay Commission was constituted in October, 2006 to recommend comprehensive changes in salary structure of the government employees.
It would give recommendations concerning the pay structure of government employees comprising industrial and non-industrial central government employees, All India Services, Armed Forces personnel and employees in the Union Territories.
Besides, the Commission would also examine the pay structure for Indian Audit and Accounts Department, regulatory bodies set up by Acts in the Parliament and Supreme Court employees.
(With agency inputs)
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