External Affairs Minister Pranab Mukherjee, Defence Minister AK Antony and Union Finance Minister P Chidambaram attended the meeting. The Prime Ministers is likely to make an announcement regarding the implementation of the Pay Commission Report during his Independence Day speech on Friday, Aug 15.
It is expected that the Pay Commission would result in an increase of around 1.83 times of the net pay for the defence personnel, though details regarding the amendment to the report are not clear. It is likely that civil servants may also get a substantial raise.
The new pay scales, if implemented, will cost the exchequer Rs 7975 crore in fiscal 2008-09. However, the one-time additional outgo on account of the retrospective revision of salaries is estimated to be Rs 18,060 crore. The arrears are to be given in installments.
The Sixth Pay Commission Report, submitted by Justice B N Srikrishna on March 24, had recommended an effective 28 per cent salary hike for an estimated 4.5 million Central Government employees.
Expressing resentment over the report, armed forces personnel had demanded a better deal considering the hardship factor involved in their services, followed by protest rallies by retired personnel. The three service chiefs also lobbied with the Defence Minister.
The Government then set up a high-powered committee headed by Cabinet Secretary KM Chandrasekhar to look into the anomalies pointed out by different sections of the government servants, including those from the defence services.