The initial expected out go to the Exchequer is expected to be in the region of Rs 13,000 to Rs 15,000 crore.
The Commission has reportedly recommended a hike of over 50 per cent in salaries of Government employees at the senior level and substantial salary hike in other categories as well.
The Commission — the arbitrator in the collective bargaining process between labour and the largest employer in the country, the Central Government — however, faces seem staggering.
It must deal with the issue of ensuring that key Government posts attract qualified candidates, given the increasing competition from the private sector.
The Fifth Pay Commission in 1996 was a fiscal disaster for the Central and State governments. After the report, state governments had no money left after paying salaries for even normal administration.
Due to the huge pay hike by the Fifth Pay Commission for Government employees, state governments started cutting corners where facilities like healthcare, education and irrigation were concerned.