Can handle financial implications of Pay Comm: FinMin

New Delhi: The Finance Ministry Thursday said it can "handle" financial implications of the recommendations of the Seventh Pay Commission and will work out modalities for implementation of the suggestions.

"There are challenges, we will face that... It's not going to impact this fiscal. By the time it is implemented, it goes into next financial year and our growth prospects are good, our economy is pretty robust, we will handle this," Finance Secretary Ratan Watal told reporters here.

ALSO READ: 7th Pay Commission recommends 23.55% hike; OROP for civilians too

In a big bonanza to central employees and pensioners, the seventh Pay Commission today recommended a 23.55 percent increase in salary, allowances and pension along with a virtual one-rank-one-pension for civilians, involving an additional outgo of Rs 1.02 lakh crore a year.

Watal also said the Finance Ministry would look at how to channelise the increase in money in the hands of people to long-term saving instruments.

The government had unveiled a fiscal consolidation roadmap in Budget under which fiscal deficit was to be brought down to 3.9 percent of GDP in 2015-16, 3.5 percent in 2016-17 and 3 percent by 2017-18.

ALSO READ: Seventh Pay Commission report: Key Highlights

Fiscal deficit in 2014-15 was 4 percent of GDP.

Earlier talking to reporters, Finance Minister Arun Jaitley said that an Implementation Secretariat, under Expenditure Secretary, will look into the recommendation of the Seventh Pay Commission.

"There will be a separate Empowered Committee which is normally headed by the Cabinet Secretary where different departments of the government which are concerned with the recommendations their heads are members. And therefore if any representations come from any segment, they take a view," Jaitley said.

ALSO READ: Pay panel recommendations to cost Rs 1.02 lakh crore to govt

"Last time when the report was submitted both these exercises took about five and a half months. This time we will endeavour to do take a decision quickly," the Minister said.

The recommendations of the Pay Commission are to come into effect from January 1, 2016.