The Punjab Government led by Captain Amarinder Singh has approved the recommendations of the 6th Pay Commission on Friday. The recommendations, including a 20 percent hike in salaries and pensions of the state government empolyees, will be implemented from July 1, 2021, with retrospective effect from January 1, 2016.
The decision comes months before Punjab goes to the polls next year.
Punjab has a debt of over Rs 2 lakh crore and the state pays Rs 27,000 crore in salaries and Rs 12,000 crore in pensions annually. The latest move will burden the government with additional Rs 35,000 crore, but it will benefit over 5.4 lakh serving and retired employees.
The pay commission was set up by the erstwhile SAD-BJP government in 2016. The Congress had promised its recommendations would be implemented by December 2019.
Punjab's 6th pay commission had put forth recommendations to increase minimum pay from Rs 6,950 to Rs 18,000 per month. The move will put an additional burden of Rs 8,637 crore on the exchequer with a prospective additional net annual burden expected to be nearly Rs 4,700 crore.
The arrears are to be paid in two equal instalments which will be disbursed in October 2021 and January 2022. Salaries and pensions under the new structure will be disbursed from July 1, 2021.
The minimum pension has now been increased to Rs 9,000/month from Rs 3,500/month and the minimum family pension will be Rs 9,000/ month.
Divorcees and widows will also come under the ambit of family pension. The Amrinder Singh government will be restoring the commutation of pension to 40 percent from July this year and has rationalised house rent allowance along with others. Special allowance to watchmen and drivers has been doubled.
In addition to the above measures, the Punjab government will be introducing a higher education allowance for employees who obtain a higher education degree during their course of employment and in the field related to their jobs. This will be a lump-sum incentive.