New Delhi: Not keen on again bearing a financial stress that fell on them after implementation of the Fifth Pay Commission, state governments want the Centre to share half the burden of pay revision of their employees, in case they go for the next salary hike.
“The states would never forget the effect of the Centre’s decision on recommendations of the Fifth Central Pay Commission regarding pay revision on states’ finances through consequences of pay revision at the states levels. This had resulted in a financial crisis for the states,” VAT panel said in its presentation to the 13th Finance Commission.
The Empowered Committee of state finance ministers on VAT said that during that time, the Centre had agreed to bear half of the burden of the states but did not actually provide the assistance.
The VAT panel said the Sixth Pay Commission will “consequently cause the states to take certain decisions for the pay structure of their employees and others with serious financial implications”.
When the Centre announcing the pay revision, it is a general practice for states to go for pay revision of its employees.
Due to the Sixth Pay revision, the Centre will bear an additional burden of Rs15,700 crore on the central budget and Rs6,400 crore on the railway budget.
Justifying their demand of sharing of the burden, the VAT panel said although the Centre has asked the 13th Finance Commission to provide for expenditure on civil administration, defence, inter reference has been made for similar expenditure for states.
In this context, the government of India should bear at least 50% of the additional consequential but Already few states, including Chhattisgarh, Uttar Pradesh, West Bengal, Tamil Nadu and Haryana, have decided to go for pay revision for their employees.