Technoglitch
Core Member
The 23.5% average hike in the central government employees’ salaries could press on the government’s wage bill by an estimated Rs 1.02 lakh crore in 2016-17, pushing up the government’s fiscal deficit by 0.65% of gross domestic product (GDP).
Out of the total financial impact, Rs 73,650 crore will be borne by the General Budget and Rs 28,450 crore by the railway budget.
In percentage terms, the overall increase in pay and allowances and pensions over the ‘Business As Usual’ scenario will be 23.55%. Within this, the increase in pay will be 16%. Allowances will go up by 63%, and the pension bill will increase by 24%, the pay commission report said.
The total impact of the Commission’s recommendations are expected to entail an increase of 0.65% points to GDP compared to 0.77% in case of the sixth pay commission, the finance ministry said.
Unlike previous years, the pay commission-recommended salary hikes this time will not carry a major “arrears” burden given as it will be implemented on a “current” basis and not retrospectively. The new salaries will come into effect from January 1, 2016. The previous three commissions worsened the government’s finances.
Rs 1 lakh cr: How 7th pay panel recommendations impact govt’s budget | india | Hindustan Times
Out of the total financial impact, Rs 73,650 crore will be borne by the General Budget and Rs 28,450 crore by the railway budget.
In percentage terms, the overall increase in pay and allowances and pensions over the ‘Business As Usual’ scenario will be 23.55%. Within this, the increase in pay will be 16%. Allowances will go up by 63%, and the pension bill will increase by 24%, the pay commission report said.
The total impact of the Commission’s recommendations are expected to entail an increase of 0.65% points to GDP compared to 0.77% in case of the sixth pay commission, the finance ministry said.
Unlike previous years, the pay commission-recommended salary hikes this time will not carry a major “arrears” burden given as it will be implemented on a “current” basis and not retrospectively. The new salaries will come into effect from January 1, 2016. The previous three commissions worsened the government’s finances.
Rs 1 lakh cr: How 7th pay panel recommendations impact govt’s budget | india | Hindustan Times
