Government faces a tough task of awarding Pay Commission: Budget 2016

The Finance Minister Arun Jaitley has pledged to implement the 7th Pay Commission award in the fiscal 2016-17 in his major speech on February 6.
At Consultative Committee attached to the Finance Ministry, he said: “During the financial year 2016-17, the central government has to make provision for about Rs 1.10 lakh crore in order to meet the liabilities on account of implementation of 7th Pay Commission recommendations and One Rank One Pension (OROP) Scheme”.

Jaitley is likely to fulfill his promise of implementation of 7th Pay Commission award for central government employees.

It is also expected, the Budget tomorrow may continue with the status quo on the income tax slabs while it may tinker with the exemptions.

Accordingly, he faces difficulties to allocate fund of Rs 1.02 lakh crore on account of the 7th Pay Commission recommendations for central government government employees.

So, can we trust the Narendra Modi led BJP government to deliver it, as promised, by Jaitley? Certainly, by choosing to focus on the 7th Pay Commission award, Modi is underlining his minister commitment to implement Pay panel award.

And that’s not surprising – the 7th Pay Commission award is a sop that the BJP is considering for the for 48 lakh central government employees and 52 lakh pensioners, as part of its plan to win over government employees voters in the upcoming Assembly elections in the five states — Kerala, Tamil Nadu, West Bengal, Uttar Pradesh, and Assam.

The 7th Pay Commission in November recommended increase in remuneration of about one crore government employees and pensioners which is estimated to impose an additional burden of Rs 1.02 lakh crore in 2016-17.

The new pay scales, subject to acceptance by government, will come into effect from January 1, 2016.