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| Central govt employees' pay hiked by 21%
Last Updated: 2008-12-24 17:46:14
New Delhi: Offering a bonanza to its about 55 lakh employees, the government on Thursday approved new pay scales that would give them an average increase of 21 per cent, a move that would cost the exchequer Rs 22,131 crore.
The windfall pay revision, announced on the eve of the country's 62nd Independence Day, would be implemented from September 1, this year and the government employees would get 32 months' arrears, that too with significant improvements over the Sixth Pay Commission recommendations.
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The union cabinet approved the effective date for the pay revision as January 1, 2006 and central government employees and armed forces personnel would get 40 per cent of the arrears this fiscal and the remaining 60 per cent next fiscal.
Finance Minister, P Chidambaram said the impact of revised pay scales on inflation was taken into account when the government cleared the recommendations and the budget deficit targets would also be adhered to.
Both the union budget and railway budget have a capacity to bear the burden on account of implementation of revised pay scale for central government employees, he told reporters after the Cabinet meeting.
He said the burden on union budget will be Rs 15,717 crore and Rs 6,414 crore on railway budget for 2008-09.
Following the revision of pay scales, total emoluments of a government employee including allowances at the lowest level will exceed Rs 10,000 per month.
Government has also fixed the annual increment for employees at 3 per cent, up from 2.5 per cent recommended by the Commission, which had submitted its report in March.
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While modifying the recommendations, the government has accepted the suggestion of the pay panel for four pay bands with 20 grade pays.
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