7th pay commission to hit Himachal’s coffers hard

Even as the central government has agreed to finance the centrally-sponsored schemes (CSS) for Himachal Pradesh in the 90:10 ratio, the imminent seventh pay commission is set to leave the cash-strapped state government in a pickle.

Even as the central government has agreed to finance the centrally-sponsored schemes (CSS) for Himachal Pradesh in the 90:10 ratio, the imminent seventh pay commission is set to leave the cash-strapped state government in a pickle.

While Himachal Pradesh was expecting to be a revenue surplus state due to high revenue gains from the Centre, the hike in pay scales would neutralise its plan.

The seventh pay commission on November 19 had recommended an average 23.55% increase in salary, allowances and pension.

The state government has been conventionally allowing pay scales on the pattern of Punjab.

While Himachal’s salary and pension budget is around `13,000 crore, its total budget for the current fiscal is `28,339 crore. On the other hand, Punjab’s salary and pension bill alone is a whopping `25 500 crore.

If the pay panel’s recommendations are implemented in letter and spirit, Himachal’s salary and pension bill would cross `15 000-crore mark.

“Though it augurs relief for state’s employees and pensioners, once implemented on the pattern of Punjab, the seventh pay commission will cause a setback of about `2,200 crore to the already fund-starved Himachal Pradesh government,” a government official, not wishing to be named, said.

Notably, Punjab had last time doled out a heftier pay package than that recommended by the sixth pay commission. Even this time, keeping its current political turmoil in mind, it cannot afford to put off the recommendations, and will have to implement them in general.

Meanwhile, for the current fiscal, the state expects to receive `23,534 crore, including `2,334.69 crore under CSS grants and `13,351.83 crore under central transfers, with an appreciation of about `3,900 crore from last year.

Of the state’s total budget, 29% is allocated to salaries, 14% to pensions, 10% to interest payments, 5% to loan repayments, while a chunky 40% is budgeted for developmental works.

As per the employee census of 2013, the total number of employees stood at 2.26 lakh of which 1.84 lakh (81.6%) are regular employees and 41,623 (18.4%) are non-regular employees.

The number of contractual employees is 15,726, part-time employees 8,153, Vidya upasak and other category employees 5,395 and daily-paid employees 12,337.

State’ budget at a glance

Total budget `28,339 crore

Salaries & pension `13,000 crore

Total employees 2.26 lakh

Proposed hike by pay panel 23.55%

Extra burden `2,200 crore approx