Hyderabad: Telangana government employees are insisting that the arrears in their salary be credited to their GPF accounts in cash along with salary instead of bonds.

Though the government had issued orders on Wednesday for payment of the revised pay scales for salaries to be paid in April, there has been no mention about payment of salary arrears of last 10 months since the formation of the new state. The TS government has decided to implement new pay scales from June 2, 2014, when TS was formed. Employees demanded that the payment of arrears be credited to their GPF accounts in cash along with salary.

However, the government is seriously contemplating issuing bonds with a validity of 10 years due to financial constraints with a lock in period of five years. After five years, employees can encash these bonds. But employees are raising several doubts over these 10-year bonds pointing out that what if government changes during the general elections in 2019 and 2024 and there is no guarantee that the subsequent government will honour these bonds.

Employees argue that they were originally eligible for revised pay scales from July 2013, but agreed from June 2014 with a view that TS was only formed in June 2014 and they did not want to burden the government by claiming arrears from the united AP state.

Employees are opposing the issuing of bonds and demanded that they be paid in cash or by way of GPF account.

CM K. Chandrasekhar Rao had promised to pay arrears in cash or GPF. He has to keep his word now. If not, employees will be forced to launch state-wide agitations against issuing of bonds,” said TSPRTU president P. Venkat Reddy, a major teachers organisation in Telangana.

Opposition parties are also targeting the TRS government on this front. “Where is the guarantee that TRS will continue to remain in power till 2025 to honour these bonds? We demand the government to pay arrears in cash,” said G. Kishan Reddy, BJP MLA and party's TS president.

The pay hike would impose around Rs 6,500 crore additional burden on the state exchequer. About 3, 00,000 employees, including teachers, and another 1, 80,000 pensioners are expected to be benefited by the pay hike.

The state government is currently spending around Rs 22,000 crore towards salary and pension annually and this is expected to go up to Rs 28,500 crore for full year next year. The government will have to spend additional Rs 550-600 crore every month on employee salaries following pay hike.