Sixth Pay Commision Approved

The good:

It was announced on thursday afternoon that India's cabinet has finally approved higher salaries for government workers.

This is immediate effect as Indian inflation did a Superman and soared to a 13-year high of 12.44%.

This is a rainbow of a news after the recommendations of a pay panel report were made earlier this year. The higher salaries for 5o lakh government workers will cost Rs 221 billion.

The bad:

Although, extra borrowing of money might be required to pay for the salary increases and that would place pressure on public finances. But Finance minister Palaniappan Chidambaram answered analysts' query by saying that India would meet its fiscal deficit target for 2008/09 despite the pay increase and that the salary hike had been taken into account while preparing the budget for the financial year.

Yet on late Thursday several employee unions expressed discontent over the Sixth Pay Commission.

The Ugly:

General Secretary of All India Trade Union Congress (AITUC)Gurudas Das Gupta said that the cabinet approval was "skilfully managed to put up the show of the government of benefitting the existing employees under the cover of privatisation, reduction of manpower and outsourcing.

"Though pay fixation formula and rate of increment have marginally been improved, it is still less than what was demanded by the staff unions.

"We are not happy at all. The major issue of concern raised by the staff unions regarding continuation of the recruitment to the class IV posts in the Central services in future have not been addressed by the government"