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Sunday, May 31, 2009

Tamil Nadu govt wage bill got heftier

It is rejoicing time for state government employees’ of Tamil Nadu, with their compensation scales brought on par with the central government staff.

Sample some statistics: the deputy collector is the biggest beneficiary with his total emoluments going up to Rs 30,730 post revision compared to Rs 23,430 that the official drew as on January 1, 2006. With a wage hike of Rs 1,310, noon-meal organisers would now get a total wage of Rs 4,780.

Extending the Sixth Pay Commission recommendations to its own employees, the TN government revised the salaries of its staff that would benefit 12 lakh government employees, including local body officials and noon-meal scheme workers, besides six lakh pensioners, TN finance secretary K Gnanadesikan told reporters at the Secretariat on Sunday.

Despite declining tax revenues due to the economic slowdown and the increasing financial burden, the state has gone ahead with its implementation. Against annual revenue estimates of Rs 59,000 crore, TN’s wage bill component of revenue expenditure constitutes Rs 14,000 crore on salaries and Rs 7,000 crore on pensions.

The pay revision would result in an additional recurring expenditure of Rs 5155.79 crore annually. The house rent and the city compensatory allowances, granted for the first time to all employees on special time scales of pay including noon-meal workers, had been doubled, Mr Gnanadesikan said.

The revised pay scales would be implemented with effect from January 1, 2006 notionally, while the monetary benefit would be applicable from January 1, 2007. On account of this measure and the "carry forward" effect, retirees would also stand to gain a pension bonanza.

The state government would also incur a further expenditure of Rs 11,093 crore on account of payment arrears, but the payout would be in three equal annual instalments. "We have already factored this in our budget calculations," he said in response to a question.

Arrears on pay revision after adjustment of interim arrears would be paid in cash in three equal instalments in the years 2009-10, 2010-11 and 2011-12. Mr Gnanadesikan said the first instalment would be released immediately post the issuance of government orders. The Central pay scales are being continuously implemented in TN.

Asked about any specific plan to handle the revenue gap, he said stamp duty and registration charges collection had declined by 30% in view of dwindling property transactions. Inflation and stagnation in VAT collections had also impacted revenues. However, by the first quarter of 2010, recovery is expected and the state has been safeguarded adequately.

Mr Gnanadesikan also said the Central finance commission team members are scheduled to visit the state on June 4 or 5. TN would seek to impress upon them to enhance its share in the devolution of funds.


  • Existing pay scales to be revised on Central ‘pay scale to pay scale’ basis
  • Allowances have been doubled
  • Annual increment will be @3% of pay plus grade pay as in GoI
  • DA will be sanctioned at same rates and on same date in the revised pay structure as sanctioned by GoI
  • New pay scale of Rs 7000-225-11500 has been created for post of ministerial superintendent so as to place this post one level above that of the assistant section officer in secretariat and a corresponding revised pay scale of Rs 9300-34800 with a grade pay of Rs 4800 with effect from 12.12.07 will be granted
  • Existing slab rates of HRA and CCA will be doubled
  • Eligibility for travelling allowance has been modified suitably keeping in view existing levels
  • Gratuity ceiling enhanced from Rs 3.5 lakh to Rs 10 lakh
  • Family pensioners who exercise option to contribute Rs 50 per month from their family pension would be included in TN Pensioners’ Health Fund Scheme
  • Consolidated pay/fixed pay/honorarium has been enhanced ensuring uniform increase of 25% of the existing emoluments

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