Seventh Pay Commission – Why it is essential for central government employees?

| September 10, 2015

 What is a Pay Commission? 

It is a commission, usually set up by the central Government with members from different branches including legal branches, once in ten years to recommend the pay structure of the Government and  PSU employees.The Government revises the pay of the Government employees, every after ten years. The recommendations of the pay commission is accepted as a base on which the Government takes the final decision about the pay revision of the employees.

In the past, the state Governments used to appoint separate pay commissions for their employees. But currently, the practice has been discontinued. Now many state Governments prefer to accept therecommendations of the central Government with some minor changes to suit their individual state.

So, the pay commission recommendations are applicable to the Government (State and Central) & PSU employees including armed forces but excluding college and university teachers of entities funded by UGC. Some private organisations also accept these recommendations. For the college and university teachers who coming under UGC, a separate pay commission is usually set up, by the government and itsrecommendations are considered for the college and university teachers.

What Critics have to Say?

Critics are always questioning ‘what is the need for a Central Pay Commission (CPC). It just increases the income of the Government Servants and creates a havoc in the economy’. Well, that may sound right, because its true that any Pay Commission do make some impact in the economy, because we are talking about a hike for lakhs of people in one shot.

But what they don’t take into consideration is, this is the only way a Government Employee can see a hike in his/her pay. In simple, without taking in to account the increase in Pay due to hike in DA and 3% annual increment a government employee works for ten years in the same pay.   At the end of the day it is the Pay Commission that fixes the bureaucrats’ pay for 10 long years.

Is It equal to all Grades?

Likely to come into effect from January 1, 2016, the officers and non-gazetted staff of various services have been lobbying hard to get a good deal from the 7th Pay Commission.

At the entry level, salary for all Group A Central services are the same, but thanks to faster promotions and two additional increments, the IAS have an edge over other Grade A services. Meanwhile the IRS ( Indian Revenue Service), who are entrusted with the job of collecting direct taxes, now claim that IRS should get better pay and perks than IAS. The reason they point out, ‘direct tax collection has grown 9.35 times between 2000-01 and 2013-14′. The IRS officers point out one more reason for demanding a good deal from the Pay Commission. For every Rs 100 they collect, the tax department spends merely 57 paisa. In percentage terms, the cost of revenue collection in India is 0.57% as against 1.58% in Japan, 1.35% in France, 1.17% in Canada and 1.05% in Australia.

If that’s not all, the IPS officers have submitted a memorandum quoting a number of reports to suggest that the tough life of a cop justifies the demand for a fatter hike in the same Grade of other services. For example, it has quoted articles published in two journals — Global Journal of Medicine and Public Health and International Journal of Pharma and Bio-Sciences — to conclude that one of two cops in India suffers from sleep disturbances and anxiety whereas chances of cardiovascular problems increase by 38% after a person joins as a police officer.  IPS wants better life and health insurance cover, an overtime allowance and also a new perk called allowance for “un-social” hours (for duty between 8 pm and 6 am).

Railway Officers too don’t want to be left behind in the race, they argue, their round the clock work deserves better salary.  “A railway officer may be called to join duty any time during the night. The pressure always remains as it’s a 24×7 work,” says RR Prasad, an Indian Railway Personnel Service officer and secretary general of Federation of Railways Officers’ Association. The officers want non-gazetted staff to get their dues but they demand the proportion of the pay of the lowest and the highest paid employee should increase from current 1:12 to 1:18.

On its part, the Indian Economic Service (IES) which has a cadre strength of 511 officers, represented in 55 Central government departments, has demanded parity in pay, perks and promotions of all services, including IAS, so that the “officers deliver what they have been employed for rather than fret over their pay and promotion prospects”.

Pay Commission’s Balancing Act

It is the Pay Commissions that tries to maintain a balance as far as inter-cadre pay difference is concerned. The pay commissions have worked to reduce the disparity among the officers of various services. Till the late 1980’s, an IAS officer used to receive a salary that is 25% higher than that of a Group A service officer. Today, the pay for all officers, at least at the entry level, is same. But IAS and Indian Foreign Service (IFS) officers still maintain an edge over others as their empanelment process (a step to get higher posts) is much faster.

The important question now is, how far the 7th CPC will go in changing the pay based on associated serviceconditions like empanelment and promotions?  IAS Officers are quoting a 1991 Supreme Court judgement (Mohan Kumar Singhania and Others vs Union of India and Others) where it was said that other services should not approach the pay commissions and attempt to change the rules of career progressions and push for a case for parity with the premier service.

But other services are continuing their demand for pay parity and also for the creation of more departments where the IAS can’t dictate. At present, only three major ministries — railways, external affairs and post — are not headed by IAS but run by their own cadres. Now, IPS wants a new department of internal security headed by a cop and IRS wants a separate direct tax department headed by a taxman.

All eyes on 7th Pay Commission

With so much of buzz and arguments in the air, will the 7th Pay Commission bring a revolution? Will the 7thPay Commission bring a total change in the system? or will it, like the past few pay commissions , adopt a simple formula of Multiplier 3 under which the basic salary is hiked by three times or more depending on the economic health of the nation. Experts are of the opinion that, yes, the same old formula would be adopted.  They argue that the 7th Pay Commission would not touch any aspects such as performance related pay, reduction of strength, reduction of retirement age etc that are politically sensitive and unpopular moves. If what they say is true, the ground situation is not going to change much. In the mean time ‘Let’s keep our fingers crossed’.

Source : Economic Times

Category: News, Seventh Pay Commission

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