Babus, don146;t despair, your pay hike safe

In the Budget, Chidambaram projected a fiscal deficit of Rs 133,287 crore or 2.5 of the Gross Domestic Product for fiscal 2008-09 when the Commission8217;s report would get implemented. However, under the Fiscal Responsibility 038; Budget Management Act, this deficit target set for the Central government is 3.

It is this 0.5 or Rs 26,657 crore 8212; which Chidambaram called 8220;headroom8221; 8212; the latitude available for paying higher salaries and arrears of 55 lakh Central government employees. Since the wage hike has to be implemented with effect from January 2006, it would be contingent upon the government to account for arrears within this amount.

Given the seemingly low number, it seems that the government had made up its mind on the pay raise while fixing salaries of Constitutional heads. Last month8217;s decision to raise the salary of Governors to Rs 75,000 indicated that the topmost bureaucrat should not expect more. For past parity has been that when the Governors were drawing Rs 36,000, the Cabinet Secretary8217;s basic was at Rs 30,000. The Commission, constituted in October 2006 to recommend comprehensive changes in salary structure of government employees, will submit its report in April.