No Major Changes Likely

There isn’t much to cheer for millions of central government employees, including those in railways, paramilitary and defence services, as the empowered committee examining the 6th pay commission’s proposals is unlikely to "rewrite" the original report in any big way.

At best, it would make minor upward revisions since the government holds the pay report to be pro-employee and prepared with a view to maximize benefits for the bulk of the officialdom.

"Every rupee hiked costs the exchequer a few crores. Even if the central government can afford to bear its own burden, the expected demand for similar hikes in the states can potentially derail the economy. More so, when many states are already overstressed after slashing sales tax on petrol products and LPG," highly placed government sources told TOI on Tuesday.

What, however, is certain is that the committee, headed by cabinet secretary K M Chandrasekhar, has progressed well in its work and is expected to submit its much awaited report by July first week. The sixth pay commission recommendations, effective from January 2006, are likely to be accepted and implemented "very soon" after that.

The committee has held over two dozen meetings with employee associations and ministries by now and it is fast veering round to the view that its larger objective is to rationalise parts of the report to benefit the maximum numbers.

Ensuring uniformity of remuneration and scales across millions of government employees, sources said, was a gigantic task and it was felt that the pay commission had done a good job.

"The committee will definitely not go into the nitty-gritty of the entire report but may recommend very minor changes here and there," sources added. Open as well as subdued protests marked the submission of the pay panel’s report on March 24 and, for the first time, the message did not go down well even with the armed forces, forcing the defence minister and the service chiefs to approach the government for a better deal.

Later, Prime Minister Manmohan Singh himself addressed the issue, promising that the genuine concerns of government servants would be looked into by the empowered committee. "I never imagined that as secretary, I would get to draw Rs 80,000 a month but the pay report has made that possible. Comparing government salaries with profit-driven corporate majors is very unfair. The recommendations have factored in a very wide range of issues that the government has to deal with," a senior IAS officer said.

The pay commission recommended a minimum entry-level salary of Rs 6,660 and a maximum of Rs 80,000 for secretaries, amounting to a minimum-maximum ratio of 1:12. The cabinet secretary’s pay was fixed at Rs 90,000. The total number of grades were reduced to 20 (from the earlier 35) spread across four distinct pay bands. It also proposed annual increment at the rate of 2.5% of the total pay with high-performers (not more than 20% of the total strength) getting a higher 3.5%.

The recommendations would also have a bearing on lakhs of pensioners across the country as their remuneration would be revised accordingly. The commission also favoured a revision of the Consumer Price Index for computation of dearness allowance as frequently as feasible and it even suggested a separate price index for government employees by the National Statistical Commission.
Source : Times of India

Pay panel : Only marginal changes expected

Under pressure on account of mounting expenditure, the government is likely to make only marginal changes in the recommendations made by the Sixth Pay Commission. Changes are likely only in the case of defence personnel and police forces, it is understood.

The committee of secretaries headed by Cabinet secretary K M Chandrashekhar looking into the commission’s recommendations is expected to submit its report by the end of July. These would then go to the Cabinet for approval.

Another panel headed by finance secretary D Subbarao is separately looking into the grievances of defence and police forces. This committee will give its inputs to the committee of secretaries that has secretaries of the departments of home, defence, revenue, expenditure, post, security as well as deputy comptroller and auditor general and member secretary of Railway board as its members.

The defence ministry and police forces have already made presentations before the committee. While marginal changes are expected to be carried out when the award is implemented, the government is unlikely to go in for major correction as it does not have much fiscal space. There is also a view that the government is only an implementing agency for the commission’s recommendations. The government’s ability to reward its employees is limited by the rising pressure on its coffers on account of subsidies for food, oil and fertiliser, as also the farm loan waiver package.

The total direct subsidies on account of food, fertiliser and oil this fiscal is estimated at Rs 66,357 crore. When some interest expenses are included, this would rise to Rs 71,430 crore. The farm loan waiver scheme is expected to drain Rs 25,000 crore. The cost of implementing the pay commission’s report this fiscal is pegged at Rs 30,062 crore.

The panel’s recommendations had invited responses showing disappointment from various segments of the government. Some officials told ET that the wage increase recommended was far below expectations and could lead to an exodus to the private sector.

One civil servant who joined the revenue service after graduating from an IIT admitted to ET that some officials were taking private tuition to make both ends meet at a time when inflation was above 8%. Middle-level officers, particularly those who are given official accommodation and transport, claim that the recommendations in their present form will not benefit them much.

PM’s Economic Advisory Council recommends Pay arrears to be given in phased manner

Prime Minister’s Economic Advisory Council wants the government to pay its employees in phased manner and deposit part of the estimated arrear of 18,000 crore in their Provident Fund while implementing the Sixth Pay panel report to minimise its impact on inflation.

"Since the payment of arrears in cash could result in marginal rise in inflation rate due to spurt in demand for various products, EAC has said that government should consider depositing part of the arrears due to employees in provident fund and pay the remaining amount in a phased manner," official sources said.

The council headed by noted economist and former Reserve Bank Governor C Rangarajan, is of the opinion that the payment of arrears in one go could result in further rise in prices, especially of manufactured goods and consumer products.

"The government had paid the arrears in a phased manner while implementing the report of previous Pay Commissions, so it can consider it again," Rangarajan had earlier said.

The council, which advises Prime Minister Manmohan Singh on important economic matters, had earlier said the inflation rate could come down to 5 to 5.5 per cent after about four months following good monsoon and measures taken by the government.

Inflation, however, has already crossed 8 per cent mark, and the analysts fear that it could soon touch 10 per cent mark if the hike in international crude oil prices is partly passed on to the consumers.

The Sixth Pay Commission headed by Justice B N Srikrishna, which submitted its report in March, has recommended an average 28 per cent hike in salaries of about 40 lakh central government employees with effect from January 1, 2006.

It estimated that hike in salaries would cost about Rs 12,000 crore annually, while the payment of arrears would put an additional one time burden of Rs 18,060 crore to the exchequer.

The Union Cabinet, which considered the pay panel report last month, forwarded it to a committee of Secretaries headed by Cabinet Secretary K M Chandershekhar, following protest by sections of government employees who are not happy with the recommendations.

Revised pay package for armed forces to be finalised today.

A revised pay package for the armed forces personnel including enhanced Military Service Pay for those below officer rank would be finalised at a crucial meeting to be chaired by the Cabinet Secretary K M Chandrashekar on Tuesday.

Besides the Cabinet Secretary, the Navy Chief Admiral Sureesh Mehta, Air Chief Marshal F H Major and Army Chief General Deepak Kapoor would attend the meeting.

The meeting would also be attended by other secretaries in the empowered group of secretaries set up by the government to go into anomalies in the pay packages of armed forces personnel.

The meeting was scheduled to be held on Monday but was put off till Tuesday, official sources said.

Meanwhile, Defence Minister A K Antony said on Monday that there was no ''large scale'' departures from the services despite the Sixth Pay Commission recommendations not coming up to their expectations.

''Army personnel are allowed to leave service on account of various reasons like suppression, extreme compassionate grounds, low medical category and failure to acquire minimum educational qualification,'' the minister said in reply to a written question in the Lok Sabha.

He put the number of officers who were permitted to leave services due to various reasons during the last five years at 3474.

Find out the arrear calculator based on CPC report here - http://staffcorner.com/sixpcar.php
Discuss the pay commission report at http://www.staffcorner.com/

Sixth Pay Commission - Public View

This is opinion from many sources -
1.There is no performance system adopted.
2.Pay for performance is in vain.
3. secretaries of GOI will decide the fate of Defence Forces and fate of all in general - thats really abusive. Lower cadre employee have no right in this decison making. Abusive to them.
4. Pvt Sector employee says Sixth pay commission is bane for country. Gov people doing nothing.
5. Economist says Gov may suffer inflation, large burden, 5 years slow. Because all state Govs also implement the same pay commission. How this money come.
6. pay commission must have a democratic setup comprising representation of all category of staff
7. its waste of time and resources....till now each n every govt. employee understood the CAKE they got into there mounth after such a hype in media by pay commission..no one is going to believe such cheap tricks by UPA govt. to make there seats strong in parliament....they will also get there part of CAKE in upcoming elections....

8. You want to live happily in India then get into IAS, if not then lick their boots or else leave India
9. it is best to scrap pay commission.But once in three years a wage board should finalise the revision of wage for all govt servants within a time frame of three months. It will boost the sincerity, honesty and productivity and that leads INDIA top of the world.
10. Scientist in DRDO, ISRO , Armed forces may loose good employees fastly.
Pay commission worst for them. Now how a class 1 officer afford accomodation, family expenses etc. in metro. Petrol prices soaring to 50 Rs. and now moving to 65 as fresh news comes crude oil prices are crossing 120$/barrel. How will government stop the inflation.