Cash crunch
Bhubaneswar, May 11: This sure is bad news for state government employees - do not expect salary revision in keeping with the Centre's seventh pay commission recommendations.
Highly-placed government sources told The Telegraphthat Odisha was not in a position to implement the recommendations as it would cost the state exchequer a whopping Rs 5,000 crore a year.
Explaining the reason for the Naveen Patnaik government's inability, the official said that the state's loan burden was expected to touch Rs 65,000 crore in the next financial year and a salary revision on the lines of the seventh pay commission recommendations would only add to the pains of a cash-strapped state exchequer.
After the six per cent increase in dearness allowance (DA) for state government employees last week, the annual salary and pension bill has touched Rs 27,472 crore from Rs 26,794 crore.
"Besides, one has to be bear in mind that there are 1.43 lakh vacancies at various levels - nearly 30 per cent of the sanctioned strength of the employees - for the past few years," he said.
The government is saving approximately Rs 9,800 crore in a year due to the vacancies.
"Filling up these vacancies and giving them salary at par with the seventh pay commission recommendations will adversely affect the state's financial health. The state's financial status at present is not that good. Government work is suffering because of large-scale vacancies. Our primary concern is to fill up these vacancies," said a senior official in the finance department.
The seventh pay commission, headed by Justice A.K. Mathur, has recommended 23.55 per cent overall hike in pay, allowances and pensions for central government employees with effect from January 1, 2016.
Once the Centre implements the decision, there will be a demand for salary revision in the state.
Fiscally stressed Odisha has joined states such as Uttar Pradesh, Bengal, Tamil Nadu and Punjab in urging the Centre to go slow in implementing the commission's recommendations as it would give them time to augment their financial resources.
Finance minister Pradip Amat told The Telegraph: "We will wait and see how the Centre is implementing it. We will constitute a fitment committee to examine the impact of salary revision before taking a final call on the issue. There is no need to jump to any conclusion at the moment."
Officials, however, argue revenue collection in the state has already taken a hit because of the closure of mines. The drop in revenue is also adversely affecting the government's flagship programmes such as distribution of rice at Re 1 a kilo and free bicycles to four lakh students.
A senior bureaucrat, who did not want to be named, said the state government would like to delay the decision to revise salaries till 2019, when Odisha goes to polls.
"We have three years' time. The state government might introduce a few more popular schemes to further strengthen its support base," he said.
An official reminded that though the Centre's sixth pay commission's recommendations were made in 2006, but the state government waited till 2008 to implement it. With the state's finances in poor shape, this time too it would not be any different, the official said.
Source: telegraphindia.com
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