Sixth Pay commission: In poll ‘largesse’, Punjab adds to ‘fat’ wage bill, rising revenue deficit

The government has also projected Punjab’s revenue deficit to rise to Rs 11,895 crore compared to last year’s revised estimates of Rs 10,397 crore.

Written by Kanchan Vasdev | Chandigarh | Published: December 9, 2015 2:24:24 am

THE PUNJAB government’s decision to form a sixth pay commission, to revise wages of its employees, comes amidst grave fiscal concerns and a rapidly rising fiscal deficit. The funds-crunched government already pays the maximum salaries in the country: 70 per cent of the state’s revenue is swallowed up by salary and pension bills, which are growing by 10-15 per cent each year. Yet the government, with a eye on the 2017 Assembly polls, has gone ahead with the announcement for another pay commission.

With a fat wage bill, estimated to be Rs 25,500 crore this year, fiscal deficit has witnessed a nearly four-fold increase over the last 13 years. From Rs 5,750 crore in 2002-2003, it rose to Rs 20,750 crore last fiscal.

According to comparative data of pay scales of government employees in different states, Punjab’s employees carry home the biggest salary packet. While an EET/primary teacher’s salary is Rs 32,580 a month in Punjab, their counterparts get Rs 27,800 in Tamil Nadu, Rs 19,820 in Gujarat, Rs 22,720 in Maharashtra, Rs 19,391 in Andhra Pradesh. Even in Himachal Pradesh, a state that follows Punjab’s salary model, a teacher is paid Rs 22,940.

Similarly, Punjab Police Constables are paid Rs 27,000, more than their counterparts in Haryana (Rs 15,920), Tamil Nadu (Rs 14,200), Gujarat (Rs 14,000) and Maharashtra (Rs 19,820). A patwari in Punjab is paid Rs 27,000 while none of the states pay their patwaris an amount of Rs 20,000. A personal assistant in Punjab is remunerated Rs 36,500, which is not matched in any other state. Similarly, junior engineers, steno typists, clerks and assistants all get more salaries than their counterparts in any other state.

And as the state prepares to further revise wages, growth rate figures are not very encouraging. The Economic and Statistical Organisation of Punjab recently pegged the annual average growth of the state at 5.35 per cent in 2014-15 as per advance estimates. It is a huge drop from the 10.18 per cent in 2006-07. Per capita investments in the state was Rs 41,003 in 2008-09 and rose to Rs 49,529 in 2013-14 compared to neighbouring Haryana, where per capita investment went up from Rs 49,780 in 2008-09 to Rs 67,260 in 2013-14.

The government has also projected Punjab’s revenue deficit to rise to Rs 11,895 crore compared to last year’s revised estimates of Rs 10,397 crore. Besides, the state is already reeling under outstanding debt expected to rise up to Rs 1.25 lakh crore by the end of this year.
The fat wage bill has already been frowned upon by none other than Deputy Chief Minister Sukhbir Singh Badal and the Finance Minister Parminder Singh Dhindsa.
Interestingly, the fifth pay commission was set up by former chief minister, the Congress’ Capt Amarinder Singh, in 2005-2006, a year ahead of the assembly elections. The commission had then recommended an increase of 27 per cent in salaries, which led to an additional burden of Rs 2,050 crore per annum on employees and Rs 650 crore on pensioners on the state exchequer. It was implemented in 2009-10.

K R Lakhanpal, a retired chief secretary, says the high salaries were justified earlier as the state had growth rates higher than the country. He added that now that the growth rate has fallen, the state should take that into consideration. “I can only urge the pay commission to consider the fiscal health of the state and compare its wage bill with others before considering any raise in salaries,” he said.

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