Around Rs 70,000 crore has been provisioned in the Union Budget 2016-17 for the implementation of the Seventh Pay Commission for government employees, a finance ministry official said.
While there’s no explicit overall provision number, the government had said the Seventh Pay Commission hike has been built in as interim allocation for different ministries.
“We have provisioned for around 60-70 per cent of the total burden that was talked about,” a finance ministry official said.
The Budget document states that “the implementation of the Seventh Pay Commission due from January 1, 2016 is to be implemented during 2016-17 fiscal as also the revised One Rank One Pension (OROP)scheme for Defence services.”
The finance ministry has provisioned for this in the Demands for Grants for individual departments and ministries. It is built into and subsumed into those allocations.
In January, the government had set up a high-powered panel headed by Cabinet Secretary P K Sinha to process the recommendations of the Seventh Pay Commission, which will have bearing on the remuneration of 47 lakh central government employees and 52 lakh pensioners.
The Empowered Committee of Secretaries will function as a Screening Committee to process the recommendations with regard to all relevant factors of the Commission in an expeditious detailed and holistic fashion.
Faced with the burden of Pay Commission recommendations, there were concerns on whether the government would be able to stick to the fiscal deficit target of 3.9 per cent for 2016-17.
However, in Budget Union Finance Minister Arun Jaitley removed all doubts and promised to adhere to the fiscal consolidation roadmap and stick to the 3.9 per cent deficit target.
(With PTI inputs)