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Shocking Salary Surge: Karnataka Govt Faces Rs 20,000 Crore Bill – How Will They Cope?

The article discusses a potential significant salary increase of 27.5% for state government employees in Karnataka. This recommendation from the Seventh Pay Commission has taken the government by surprise due to its substantial financial implications. Chief Minister Siddaramaiah had previously indicated openness to considering the commission’s proposals, but the scale of the proposed hike presents challenges.

The timing of this decision is critical, with Lok Sabha elections looming. Despite criticisms of prioritizing guarantee schemes over developmental initiatives, the government now faces a substantial financial commitment. The projected annual burden of Rs 20,000 crore underscores the magnitude of the challenge.

The initiation of the model code of conduct, effective until June 4, unexpectedly provides an opportunity for the government. This period allows for a thorough assessment of budgetary needs and necessary adjustments to accommodate the proposed salary increase. While the government initially anticipated a more modest increase of 15% to 20%, the higher figure necessitates additional financial resources.

Basavaraj Rayareddi, the economic advisor to the Chief Minister, assures that funds have been allocated in the 2024-25 budget to address the expenses associated with the proposed hike. Furthermore, he emphasizes that this allocation, combined with the interim relief already provided, demonstrates the government’s commitment to meeting its obligations. Despite criticism from opposition parties, Rayareddi asserts that the expenditure will be managed strategically throughout the fiscal year, mitigating immediate financial strain.