Thursday, 17 August 2017

7th Pay Commission: Lower pay not to root out corruption


7th Pay Commission: Lower pay not to root out corruption
New Delhi: Corruption is rampant in many of the central government's offices, despite Prime Minister Narendra Modi's warning that corruption was eating away at India "like a termite".

Accordingly, the government should consider to root out corruption in the Indian bureaucracy and the official system through ensuring the proper wages and benefits for government employees.

The 50 lakh central government employees are now getting 14.27 % hike in their basic pay under the recommendation of the 7th Pay Commission, which is the lowest in 70 years.

The previous 6th Pay Commission had recommended a 20 per cent hike in the basic pay, which the government doubled while implementing it in 2008.

The 7th Pay Commission slashed down House Rent Allowance (HRA), which constitutes a substantial part of central government employees' salaries. The Commission had recommended HRA at the rate of 24 per cent, 16 per cent and 8 per cent of basic pay of the central government employees and the government stuck with the 7th Pay Commission's recommendations on HRA and gave nod accordingly.

While The previous 6th Pay Commission had recommended HRA at the rate of 30 per cent, 20 per cent and 10 per cent for X, Y and Z category of cities respectively.

The hike in HRA, which gives more money in the pockets of the employees, that's compensatory perks for all central government employees, which has been paid from July 1 and no arrears for any allowance was paid, as per usual practice, the allowances are paid from the date of implementation.
The allowances, including House Rent Allowance (HRA) rates, started to disburse from July 1, this year, while, the 7th Pay Commission award was implemented from 1 January 2016.

There had been widespread demand from central government employee unions to hike HRA at the rate of 30 per cent, 20 per cent and 10 percent of basic pay and to be given arrears on allowances including HRA.
"The demands of central government employees over their pay scales as well as minimum pay and allowances are likely not to be considered by the National Anomaly Committee on behalf of the government," the finance ministry sources said.

"Finance Minister Arun Jaitley finally decided not to give any facility to central government employees better than the 7th Pay Commission recommendations and the government stuck with the 7th Pay Commission recommendations on pay scales and allowances," the sources added.

The central government employees unions had also demanded for hiking minimum pay Rs 18,000 to Rs 26,000 and asked to raising fitment factor 3.68 times from 2.57 times, which was implemented by the government based on the pay commission recommendations.

If the 2.57 fitment formula is tinkered with, then salary and pension in general for all central government employees will go up.

The minimum pay and allowances should be hiked for central government employees immediately by the government on the acceptance of the unions' proposals.

Such a move would help to start countering the criminally extortionate mind-set which embeds corruption in many government posts as a way of mitigating low wages. Better-paid staff are more motivated in performing their jobs well and in working to root out corruption.

Implementing such an approach to government employees salaries has been shown to work very well in countries such as Singapore. If we are to emulate this here, the government also needs to take a more rational approach to managing is resources.

This would allow the government to pay, recruit, and retain higher quality government officials and begin to root out corruption and poor quality in public services, once and for all.
 

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