Friday, June 12, 2009

States urged centre to bear cost of pay hike implementation

State governments, in a unanimous decision, have asked the Centre to bear 50 per cent of the cost from implementing Sixth Pay Commission recommendations in the backdrop of the economic slowdown, which has depressed revenue collections.

In addition, the states also sought relaxation of fiscal deficit targets by another 2 per cent of their Gross State Domestic Product (GSDP) for at least two financial years, from the current level of 3.5 per cent of GSDP. If implemented, this would mean additional borrowing of nearly Rs 1,20,000 crore over the next nine months of fiscal 2009-10.

“There was a consensus among states that 50 per cent of the expenses arising out of implementation of the Sixth Pay Commission should be borne by the Centre,” said Assam Chief Minister Tarun Gogoi, after emerging from the first ever pre-Budget meeting between states and the Union finance ministry.

Chief Ministers Prem Dhumal (Himachal Pradesh), Digambar Kamat (Goa) and Finance Minister of Chhattisgarh Amar Agarwal also toed the same line after the meeting. “States are facing difficulty in revenue generation. The Centre should bear the cost of the Sixth Pay Commission to help us,” Kamat added.

Though Sixth Pay Commission is applicable only for central government employees, many states benchmark their pay revision based on central pay commission.

The Sixth Pay Commission recommendations were accepted by the Union Cabinet on August 14. The recommendations lead to an average increase of 21 per cent in salaries of 5 million government central government employees. The central exchequer’s annual cost went up by Rs 17,798 crore because of the new wage structure. Moreover, the recommendations also cost the government Rs 29,373 crore on account of arrears from January 2006 and August 2008.

Source : Business Standard.

No comments :

Contact Us

Viewers may share any information with the administrator in this email
Any news, if approved, may be published in this blog under his /her name.
Related Posts with Thumbnails

Blog Archive

Bookmark This Page

Bookmark and Share
All the information published in this webpage is submitted by users or free to download on the internet. I make no representations as to accuracy, completeness, currentness, suitability, or validity of any information on this page and will not be liable for any errors, omissions, or delays in this information or any losses, injuries, or damages arising from its display or use. All information is provided on an as-is basis. All the other pages you visit through the hyper links may have different privacy policies. If anybody feels that his/her data has been illegally put in this webpage, or if you are the rightful owner of any material and want it removed please email me at "" and I will remove it immediately on demand. All the other standard disclaimers also apply.