The Budget has provided for close to ₹1-lakh crore for higher salaries and pensions through the implementation of the One Rank One Pension scheme for defence personnel and the Seventh Pay Commission report.
Of this, a little more than ₹20,000 crore has been provisioned for OROP and another ₹70,000 crore for implementation of the Seventh Pay Commission report.
“About ₹20,000 crore is for defence pensions. Of this, close to ₹14,000 crore will be for OROP and another ₹7,500 crore is factored in for higher defence pensions due to the Pay Commission report,” Finance Ministry sources said.
Similarly, while there is no exact calculation for the exact hike in salaries and pensions from the implementation of the Seventh Pay Commission, the Budget has made a provision of about ₹65,000 crore to ₹70,000 crore this fiscal.
The Budget did not make any special allocation for the Pay Commission or OROP roll out but Finance Minister Arun Jaitley had said that these have been already factored in and an interim provision for higher salaries and pensions have already been made in the allocations to various ministries.
The Finance Minister had, however in February said that the OROP and the Pay Commission implementation would require ₹1.10 lakh crore in 2016-17.
Sources said the government has not made public the provision for OROP as it did not want any kind of controversy. Similarly, the actual payout of the Pay Commission would be based on the recommendations of the Committee of Secretaries (CoS) headed by Cabinet Secretary PK Sinha which is reviewing the pay panel report.
Economic Affairs Secretary Shaktikanta Das had said that if required additional provision of ₹20,000 crore or more would be made in the course of the year to meet the salary and pension pay outs, depending on the recommendations of the CoS.