Hyderabad: The Telangana government has decided to deduct 1.5% of the basic pay of state government employees and pensioners towards contributions to the Employees Health Scheme (EHS) Fund. The deduction will be effective from the salary and pension for May 2026, payable in June 2026, as part of efforts to strengthen the state’s health insurance mechanism for government personnel.
In a separate move aimed at employee welfare, the government has also released Rs 2,000 crore to clear pending dues of serving and retired government employees, reaffirming its commitment to honour financial commitments despite fiscal constraints.
1.5% Contribution to Employees Health Scheme
Chief Secretary K. Ramakrishna Rao issued the official orders directing all Heads of Departments, District Collectors, Drawing and Disbursing Officers (DDOs), Treasury Officers and Pay & Accounts authorities to ensure timely deduction of the prescribed contribution.
According to the order, the deducted amount will be credited to the Employees Health Scheme Fund under the designated government account head relating to Development and Welfare Funds for Medical and Public Health purposes.
The government stated that the contribution will be deducted from:
- State government employees
- State government pensioners
The deduction will commence from May 2026 salary and pension payments released in June 2026.
Duplicate Deductions to Be Avoided
The government has also laid down safeguards to prevent duplicate deductions in specific family cases.
Only one contribution will be deducted in the following situations:
- Both husband and wife are state government employees.
- One spouse is a serving government employee while the other is a state government pensioner.
- A pensioner receives both service pension and family pension.
The order directs Drawing and Disbursing Officers to verify eligibility through documentary evidence and update spouse employment or pension details in the IFMIS-HRMS system.
If duplicate deductions have already been made, the excess amount will be refunded.
Treasury Authorities Directed to Ensure Compliance
The government instructed all Treasury Officers, Works and Accounts Pay & Accounts Officers, the Pay and Accounts Officer, Hyderabad, the Examiner of Accounts, Finance Managers and other authorised payment authorities to ensure that:
- The prescribed deductions are correctly made.
- The deducted amount is credited to the designated Employees Health Scheme Fund without delay.
- Proper accounting procedures are followed.
Telangana Releases Rs 2,000 Crore Towards Employee Dues
Alongside the health scheme announcement, the Telangana government released Rs 2,000 crore towards clearing pending financial dues of serving and retired employees.
The funds were released by Principal Secretary (Finance) Sandeep Kumar Sultania following directions from Chief Minister A. Revanth Reddy and Deputy Chief Minister Mallu Bhatti Vikramarka.
Government Fulfilling Promise to Employees
Deputy Chief Minister Mallu Bhatti Vikramarka said the latest release demonstrates the government’s commitment to employee welfare despite financial challenges.
He recalled that during discussions with Employees’ Joint Action Committee (JAC) leaders, the government had promised to clear Rs 6,000 crore worth of pending dues within 100 days.
According to him:
- Rs 2,000 crore was released in the first phase in May 2026.
- Another Rs 2,000 crore has now been released in the second phase.
- The remaining dues will be cleared as per the government’s commitment.
GPF and Retirement Benefits Cleared
The Deputy Chief Minister also highlighted significant progress in settling retirement-related liabilities.
According to the government:
- All pending General Provident Fund (GPF) dues of retired employees have been cleared.
- Pending GPF dues of Zilla Parishad teachers have also been settled.
- All commutation dues of retired employees up to September 2025 have been paid.
He reiterated that the Telangana government continues to accord top priority to the welfare of both serving and retired employees while ensuring financial discipline.
