Sixth CPC Report (xi): Other allowances

April 12, 2008April 12, 2008 Ajit glowfriend Sixth CPC Add new tag, Allowances Central Govt Employees, CCA, HRA, SCA, Sixth CPC, Sixth Pay commission, TA

Regarding Allowances other than Deraness Allowance, the Commission has offerd a mixed bag of benefits and also recommended some cuts in existing package .

(i) For City Compensatory Allowance which was being paid @ Rs.90-300/- for A-1 Category cities and at lower rates for A (Rs. 65-240/-), B-1 (Rs.45-180/-) & B-2 (Rs.25 -120/-) category cities to compensate for higher cost of living in these cities, the Commission has noted that the benefit provided is too low (1% to 5% of BP) and the criteria followed is not scientific enough to justify it’s continuation. It has noted that Housing and Transport are two major expenditure heads in larger cities but these are being compensated enough under HRA & Transport Allowance. Abolition of CCA has been recommended.

(ii)There are several other Compensatotry allowances / Special Duty Allowances (SDA) payable to employees serving in difficult areas such as hill / border/tribal/ remote / hard / project areas and also payable to the employees serving in North East, Andaman & Nicobar and Lakshdweep Islands, Sunderbans and Gandhinagar and even a bad climate allowance for certain areas. The Commission has recommended for rates which are approximately twice of of the existing rates . Allowances for border area and Gandhinagar were found to be without justification and recommended for discontinuation. (pg. 234 Chapter 4).javascript:mctmp(0); . The SDA for North East would be payable to all categories of employees irrespective of the fact whether they have All India Service liability or not. Concessions of similar nature has also been recommended for Central Govt. employees serving in Ladakh reigon. Islands Special Duty Allowance (ISDA) presently payable to employees in Andaman & Nicobar and Lakshdweep Islands @ 12.5% and 25% shall continue to be paid at the same rates however from now onwards all employees would be entitled for the allowance irrespective of the consideration as to whether they have all india service liability or not. Employees serving in Nicobar Islands and Lakshdweep would get Hard Duty Allowance @25% over in addition to ISDA referred above.

(iii) For travel on tour and transfer the following scale of admissibility have been recommended:

For travel outside the country the travel entitlements would remain the same. However the Commission has recommended that the benefits of mileage points earned by the government servants on official tours would be transferred to the respective departments (for utilisation for official tour of other employees). Utilization of these mileage points by the respective government servant for private journeys would invite disciplinary action.

For travel by road by means of public transport reimbursement to the extent of entitled class train fare is recommended.

(iv) The Commission has noted that the present rates for reimbursement of daily allowances for officials on tours are grossly inadequate. The recommendations are as follows

(v)The findings are similar for composite transfer grant payable to employees on transfer involving change of residence in public interest. It has been noted that some of the rates presently adopted are illogical and cause financial hardship to employees. The following rates have been recommended in order to rationalize the structure.

For employees serving in Andaman & Nicobar Islands any further concessions are not found admissible.

The Commission has made the rates for both the above cases dynamic i.e. the rates would increase by 25% whenever the the DA payable on revised pay increases by 50%.It has also suggested that in future the budget for travels should be kept to minimum and unnecessary travels should be avoided.

(vi) In respect of Transport Allowance the following revised rates are recommended to compensate for the increase in fuel cost.

The employees staying in official accommodation within proximity of workplace would also be entitled for this allowance. For the physically challenged employees the rates remain double of the rates subject to minimum of Rs.1000/- pm. The Officers in PB=4 have the choice to avail Transport Allowance @ Rs.7000/- pm on condition of giving up the facility of using official transport for traveling between home and workplace .

(vi) The Non Practicing Allowance (NPA) presently paid to Doctors in Govt. Service to compensate for loss of private practice has been recommended to be continued for historical reasons and also for the reason that the entry into govt. service is at a relatively late stage for medical professionals and also due to the reason that the working conditions are comparatively difficult. NPA shall be paid @ 25% of sum total of band pay +grade pay subject to ceiling 85000/- on this amount (BP+GP). NPA has not been found admissible for any other category of government employees.

(vii) For considering the demands for increase in House Rent Allowance (HRA) the Commission has taken note of increase in rental values in smaller unclassified towns and attempted to mitigate sufferings of employees on this account by clubbing unclassified towns with Gr. C towns. The rates of HRA recommended are as below.

(viii) Commission has recommended for merger of Children education allowance with Tuition fees reimbursement. Henceforth reimbursement is permissible up-to Rs.1000/- for education and upto Rs.3000/- pm for hostel charges per child subject to ceiling of two children.

(ix) For employees in hazardous posts involving health risks ,the risk allowance has been discontinued and the employees are now proposed to be covered by free medical insurance ranging from Rs. 5 Lakhs to 10 Lakhs depending on respective category at govt cost .The insurance cover is proposed to be dynamic subject to 50% increase whenever DA increses by 50%.

(x) For Uniformed forces the revised rates of initial grant for uniform allowance shall be Rs.14000/- (Rs.16000/- for coast guards) against earlier rate of Rs.6500/-.Renewal is recommended every three years (instead of earlier 5 years) @ Rs.3000/- (Rs.5000/- for coast guards) .The rates of kit maintenance allowane for all other categories are also proposed to be doubled.

(xi) For all other allowance such as cycle, washing, cash handling, machine, Night duty, Split duty Allowances the rates are recommended to be doubled and shall be dynamic being linked to increase in DA as for other allowances mentioned at sl.no.(v) above.

(xii) The rates of Deputation (Duty) Allowance and Central (Deputation On Tenure) Allowance shall continue to be paid @ 5,10 & 15 % of the aggregate of pay and grade pay without any limits . However aggregate of grade pay and Deputation allowance should not exceed Rs.39,2000/- which is the starting pay for PB-4. The Central (Deputation On Tenure) will continue to be be payable only up-to Director level posts.

Next Post: Retirement benefits

Sixth CPC Report (x):Central Services:(ii)

April 8, 2008April 8, 2008 Ajit glowfriend Sixth CPC Indian Audit and Account Service, Indian Foreign Service, Indian Postal Service, IRS

The previous post had covered the recommendations for Central Services Gr. A with reference to common issues for various Central Services. Summary of recommendations for individual services is given below.

For the Indian Foreign Service the recommendation is for maintaining parity with IAS. The demand of Indian Audit & Accounts Services (IAAS) for merger of posts of Addl Dy CAG and Dy CAG has not been accepted since the same may amount to cadre review -an exercise which Commission does not consider within scope of it’s activities. Commission feels that the Govt. can later consider such requests separately. Commission has also recommended for setting up of a committee for merger of other Gr. A Accounts Services with IAAS with the objective of better resource utilization . Railway Accounts Service is however to be considered separately in light of recommendation for Corporatisation of Indian Railways .

Indian Civil Accounts Services had demanded the integration of finance and accounts functions . The demand has been considered to be fit for referral to Administrative Reforms Commission.

For Indian Customs & Central Excise Service the demand for restructuring of Central Board for Excise & Customs (CBEC) on pattern of Railway Board has not been accepted since the nature of responsibilities in the two services are different. The demand for encaderment of posts of Chairperson and members of CBEC has also not been found acceptable since this would reduce the flexibility and openness of selection process. The post of Chairman is proposed to be covered in the Scale of Rs.80000 (fixed ) with rank of Special Secretary.

While the demands of Indian Defence Accounts Service have been found fit for examination by the Govt. separately taking in view the functional needs, the demand of Indian Defence Estate Service for creation of three posts in Scale of Rs 24500 -26000 has not been agreed to. Similarly the demand of Indian Economic Service (IES) for time bound promotion up to Higher Administrative Grade (HAG) and similar demands from Indian Statistical Service and Indian Trade Service are expected to be settled with the introduction of the Pay bands providing for uninterrupted mobility in career progression . The scheme of modified ACPs is also expected to take care of similar concerns expressed by these services . The observations with reference to demands of Indian Information Service are of similar nature.

With reference to Indian Ordnance Factories Service recommendations to the Govt. are for studying the feasibility of corporatisation on the lines of BSNL as recommended by Nair Committee and Kelkar Committee earlier. It is expected that such a move would make the units financially competitive and viable entities.

Major benefits have been recommended for Indian Postal Service keeping in view the expected expansion of activities in future . Proposals include merger of two pre revised scales of Rs 22400-26000 and Rs. 24050-26000, a step which would place the posts of Pr. Chief Post Master General (Pr.CPMG) and Member Postal Board in the same pay band (PB-4) and grade pay of Rs.13000/-The Postal service Board is proposed to have six posts of members in the above scale and shall also include post of Pr. CPMG. Commission has recommended that three circles of Maharshtra , Tamil Nadu and MP shall be headed by CPMG instead of Principal CPMG.

Indian Revenue Service having cadre strength of more than 4400 officers has received specific attention . Commission has noted that it does not have a single Secretary Level post despite the large cadre strength. The recommendations propose up-gradation of post of member Central Board of Direct Taxes (CBDT) in the scale of Rs.80000/- (fixed) which will be at par with the Scale of Chairman (CBDT) and equivalent to Special Secretary to Govt. of India .The Commission has also proposed encaderment of some posts of Board members in the Indian Revenue Service as a promotional incentive for the service.

Next Post: Recommendations for other allowances

Sixth CPC Report (ix): Central Services Gr A:(i)

April 7, 2008April 8, 2008 Ajit glowfriend Sixth CPC Central Services, Pay Panel, Salary Central Govt, Sixth Pay, Sixth Pay commission

Central Group A Services comprise of Organized and General Group A Services. The Organized Services cover Technical, Non Technical, Medical and other Services including Scientific Services. Taking an overview of the organisational structures the Commission has taken note of the fact that the pyramidical structure of the hierarchy in these services restricts the pace of upward mobility at the top stages leading to stagnation at Higher and Senior Administrative Grades (SAG/HAG) despite of several instances of cadre review and restructuring and consequential induction of several senior level posts in these organizations.

An important recommendation for taking care of this difficulty is for decadring of 20% of the posts in SAG and above ranks by all recognized services which would be allowed be filled up by Govt from any source . The Services would in turn be allowed to operate equal number of non functional posts in Senior or Higher Administrative Grades to be filled up with officers with minimum length of service as per the laid down procedure. Benefit for promotion to HAG shall be available from 1st January of the year when promotion became due irrespective of the date of DPC. On regular posts being available the officer could be inducted there in without any further procedural delays.

The major demands from Central Services before the Sixth CPC related to parity with IAS, better entry grades scales and allocation of posts under Central Staffing Pattern in fair proportion and through a transparent process. Against this demand the Commission has recommended restriction of gap in batchwise parity in Central appointments to the extent of 2 years only. In practical terms this implies that on posting of an IAS officer of a particular batch to a particular grade pay in pay bands PB-3 or 4 in Center, non functional pay scale of higher nature should be made available to Central Services officers with seniority higher by two years or more as personal scale. The officers would however get substantive postings when vacancies are available. Also for promotion to SAG common policy is recommended to be followed by all the Central Services in order to remove disparities. In order to ensure fair play in process of selection for SAG posts the involvement of UPSC has been recommended. Above measures are expected to remove the anomalies in career advancement prospects in these Services.

Responding to the demand for higher pay package at the entry grade the Commission has increased the same uniformly for all the Central Services on pattern of All India Services. It has however not agreed to cadre review or restructuring for any service. These are the common issues. Individual service specific recommendations covered in the next post.

Sixth CPC Report (viii):Army :Retirement Benefits

April 7, 2008 Ajit glowfriend Sixth CPC

For the Armed Forces the Sixth Pay Central Commission (CPC) has offered a liberal package of post retirement benefits. While only a few demands have not been found reasonable on the ground that the benefits sought would automatically flow in the revised pay structure, a number of modifications have been made in favour of the personnel to make the package attractive. Commission has not agreed to the demand for one rank one pay and suggested that the scheme approved by Fifth CPC may continue with two categories of pensioners i.e. pre and post 1/1/86 pensioners who have full parity and pre and post 1/1/96 pensioners who have a partial parity in pension structure.

Under the existing system the Commissioned Officers in the Army are entitled for pension on completing 20 years of qualifying service which at a rate which is 50% of the average of last 10 months’ emoluments subject to the condition that full pension is payable on completion of 33 yrs of service. There was also a special benefit of weightage of 3-9 yrs (5yrs for civilians) if the qualifying service was less than 20 years in order to make up for truncated service which is a common feature due to causalities inflicted during action. Recommendation of the Sixth CPC is for removing the condition of 33 years of service for qualifying for full pension. Pension would be calculated on last pay drawn or average emoluments whichever is higher. Military Service Pay would also be counted for calculation of Pension . This gesture would also take care of other demands including that of fixing the pension at highest stage of scale of pay attached to post.

Upper limit for commutation of pension all categories would be 50% and pensioners would be entitled for restoration of commuted value after 15 years.

For second pension the demand for reducing qualifying service (from 15 to 10 years) in respect of ex servicemen employed in Defence Service Corps has not been found justified since Defence Personnel with easier integration into Central Paramilitary Forces (CPMFs) have a longer work tenure nowadays and need for such benefits is not felt.

The benefits given to officers would also be extended to Personnel Below Officer’s Ranks (PBORs). For PBORs revised benefits would be admissible from 1/1/2006. Classification pay would also be taken into account for pension purposes. For PBORs the limit for qualifying service in respect of pensions shall continue as 15 years .The Report suggests that the increase in pension for Group X is expected to be between Rs 2016/- to Rs. 4245 /- and for Group Y pension is to expected increase can be from Rs.1247/- to 3392/-

While considering the demands for increase of pensionary benefits to Havaldars getting Honorary ranks of Naik Subedar it is proposed to consider it as regular promotion to higher grade and give all consequential financial benefit for calculation of pension.

The family pension is also recommended for cases of casualty during trial of weapons and ammunitions. For family pensioners other major changes proposed relate to permitting lifelong admissibility to unmarried daughters (instead of existing provision of pension up to 25 years of age) and also the recommendation that family pension at enhanced rates should be payable up to 10 years (instead of existing limit of 7 years) for personnel dying in harness .

For the case of army personnel who are liable for disability pension or war injury pension the proposals tends to make substantial changes in the quantum of compensation. The rate of disability pension is proposed @ 30% of the basic pay and would be doubled to (60%) if the injury is acquired in a war or war like situation. Commission has also suggested removal of conditions of qualifying service now applicable for retirement cases where disability is not related to service matters. The disability component of pension in all “ attributable” cases ( cases of disability due to service related matters) is also recommended for cases where disability is less than 20%.

Ex servicemen having acquired 100% disability are given constant attendance allowance for engaging attendants throughout their lifetime. Commission has proposed that this may be increased to Rs.3000/- per month instead of existing Rs.600/-.This is a dynamic pay package subject to increase @ 25% whenever the DA payable on revised scales goes up by 50%.

Last major recommendation concerns increase in the rates of exgratia payable to to families of armed forces personnel who die in harness. Recommendations propose doubling of rates for all eventualities. For death in course of duty the quantum proposed is Rs. 10 Lakhs (existing Rs. 5 Lakhs).For causalities in enemy action and international war the amounts proposed are Rs.15 /20 Lakhs ( against existing Rs.7.5/10 Lakhs).

Next Post: Central Services

Sixth CPC Report:(vii) Army Pay Scales (1)

April 4, 2008April 5, 2008 Ajit glowfriend Sixth CPC AFMS, Army, Army Pay Scales, MNS, Sixth CPC

Chapter 2.3 of the Report briefly recaptures the historical developments in reference to determination of pay structure for the Armed Forces, starting from constitution of the Post War Pay Committee in 1947 which for the first time attempted to establish relative parameters in reference to Indian Police Service (IPS) and the Central Class I Services but also brought down the pay scales of many Indian Commissioned Officers. The Government subsequently modified pay structure for Armed Forces in 1960 when the Raghuramaiya Committe endorssed the concept of parity with the above referred services as conceived earlier.

The pay structure for Army was for the first time referred to Central Pay Commission (CPC) at the time of Third CPC which recommended merger of the Special Disturbance Allowance (being paid to army personnel since 1950 as a temporary compensatory measure) with the pay, there by making the pay structure for Army slightly better than civilian pay scales. The Fourth CPC accepted the demand for running pay bands and rank pay up to the scale of Brigadier, but the structure was subsequently realtered by Fifth CPC which gave scales on pattern of civilian establishment to the Armed Forces with a slight edge due to difficult working conditions. The recommendations of Fifth CPC which form the basis for existing pay structure are reflected below.

The Sixth CPC has recmmended restoration of Running Pay Bands on the ground that similar structure is now recommended for Civil Services and the possibility of disparity on that account is ruled out .Another important benefit is that this measure would facilitate smoother absorption of ths Short Service Commission Officers (SSCOs) and Personnel below Officer’ Ranks (PBORs) in Central Paramilitary Forces (CPMFs) by identification of analogous posts in the two structures (e.g.Major and Deputy Commandant in Army and CRPF). It has however added a new component to the salary of armymen under the title of Military Service Pay(MSP) which would be admissible to all ranks upto Brigadier.

The Commission foresees that the MSP shall ensure that the edge enjoyed by the army pay structure vis a vis the pay scales for civillian employees continues . MSP shall be counted as pay for all practical purposes. Although MSP shall not be admissible beyond the rank of Brigadier yet the edge provided by MSP shall continue at subsequent stages since it would be embedded in the pay at subsequent fitment stage. However for purposes of determination of comparative seniority the indicator shall be the grade pay. MSP being a new addition to pay, arrears would not be payable for the past. The Pay Structure as recommended by Sixth CPC is as follows.

Some other major recommendations relate to upgradtion of Scale of pay admissible to Director General of Armed Forces Medical Service to Rs.80000/-(fixed) and the decision to allow the non functional scale of Army Commander to Lt. Generals who do not get the post due to age bar. Similar benefit has been recommended for ofiicers of other ranks who are similarily deprived of promotion due to shortage of tenure. Commsision has however not agreed to increase the scales for Principal Staff Officers posted at Army HQs on the ground that this would affect the relativity with Corps Commanders operating in the field.

Commission has also recommended continuation of existing higher entry grade pay to Lieutant in Army Medical Corps (AMC) as compared to Lieutant in the Army. Higher pay to the extent of 7.5% for Lieutant and 10% for the Captain has been recommened. Regarding Military Nursing Services (MNS) the recommendation is for maintainig parity with the Service cadre Officers. Extension of time bound promotion scheme upto level of Lt. Col. has been recommended for the Officers of MNS and MSP to the extent of Rs.4200/- has also been recommended alongwith benefit of one pay fixation increment at the stage of promotion .The Pay Scales recommended for MNS are given below.

Report of Sixth CPC :Influenced by Bachchan family?

April 2, 2008September 24, 2020 Ajit glowfriend Sixth CPC Bureaucrats, Lalu Prasad, sixth CPC Report, UP CM

Since the initial euphoria about the Pay Commission Report was dying out we thought of having a virtual survey of stake holders in order to find out as to who was saying what about the Commission report. While doing rounds of the corridors of power the glowfriend started with the humble Gungadeen peon in Ministry of Sensational Developments . Offcourse Gungadeen had heard the Babus deliberating over the report but all that he knows about his fate is that he would be getting a five figure salary in not too distant future. About the arrears part he was a bit depressed since “..20-25 hajar rupai may to pahli beti ki shaadi wala loan bhi nahi cover hoga….” (20-25 thousand would not even settle the loan for first daughter’s marriage) .

The ever cheerful stenographer in the section Madam Ragini was also not so pleased with the belated announcement on six month’s maternity leave ” ….. jab bacche bade ho gai..” ( …now when Children have grown up) and for flexible working hours .”….Yeh bhi kaun si nai baat hai , ladies and officers to sab pahle hi apni marji se aatey jatey the.” (What is new about that , ladies and officers came and went as per their will earlier also). Under Secretary Mr. Bhattacharya popularly known as Bhatta Babu was still pouring over the excel sheet hosted by some enterprising “Arrear Calculator” on the website .”….. Yeh saab baaahut conphuson hai DA ka rate ka bare mein kuch theeek theek bola nahin , Khali JS and above ke liye report hai. Hamara kya banega lakh taka bhi nahin milega arrear mein. “ (it is all very confusing, DA calculation formula is not clear . All benefit is for JS and above).

We then knoked at the door of PA to JS in the MInistry. PA was a bit scared ” Jab se report aaya hai sahab bad mood mein hai .” (Sahab is in bad mood ever since the report has come). Still then glowfriend tried to take a chance. Mr. Balasain was staring agitatedly at the laptop screen while browsing the download of CPC Report. It’s atrocious he said “See we sit here till 9 PM and type out cabinet notes , and it is the peon who corners all the benefit. When I started my job 30 years back a four figure salary was a status symbol . Now my peon will be getting five figure salary. I am shocked! ” . When asked about the arrear part Bala was still more upset .“Arrear of 3-4 Lakhs what would that get us ? A single room tenement in some JJ Colony ! And tell me how is the Government concerned with the mileage points that I earn on official journeys by air . How can the mileage points be monitored ?” . Having seen the mood of civil servants we decided to talk to some political bigwigs.

The Old comrade in CPI appeared quite agitated over the manner in which Tatas and Ambanis were taking over the country. “What will the middle class do with that illgotten money ? Buy Nano and what else? See how the lowest paid workers are suffering everywhere . Is anyone bothered?”

The madam ex politician cum animal right activist was quirte hurt when asked to comment on the headline “Peanuts for Monkeys” with reference to CPC Report. “Please spare the monkeys why do you degrade them like this” . The politician from South in sunglasses had however a different reaction to the cited headlines.”Monkeys are free to enjoy their peanuts but they should not make false claims regarding ancient underwater bridges.”

The politico from Bihar was also quite upset like all others ” Hum jo kuch bhi karta hai yeh log sab satyanash kar deta hai. Dekho hum rail ka kiraya itna kum kar diye ki ab hamar samadhi log bhi AC two tier mein ticket kharid ke chalta hai. Aur yeh log LTC may hawai jahaj permit karta hai . Sara chhota mota aadmi flight mein bhara rahta hai.”(Whatever I do these fellows spoil that. See I have reduced the train fare so much that even my relatives buy tickets for train travel. And these fellows are permitting air travel for LTC . All petty persons nowadays crowd the flights)

For the patriotic reigonal leader the Commission conspiracy is quite evident from the name of Commission itself. “Just see how they have doubled transport allowance . Who do you think will benefit… All Bihari Taxiwalas only. House rent…. they pay highest for Mumbai so that all Govt Servants from whole of the country may rush to this city.”

The best response was from the lady CM : “It is all conspiracy of Bachchans to ruin the economy of my State . Very soon our employees would ask for similar pay rise.” But how did she conclude that it was inspired by Bachchan influence? ” Because dekho yeh Abhishake Bachchan suggested in an ad that all individuals should have a number instead of name for identification. I hear that this Commission has done the same and officer’s seniority would now be known with a number. Yeh grade pay kya hai yahi to hai. Sub afsaron ko number de diya.” (What is this grade pay, they allotted numbers to all officers). Madam it appeared was agitated since all the fun in suspending and shunting senior bureaucrats had gone. A news item in future would perhaps read like “ CM today during her field visit to Rai Bareilly ordered suspension of A Kumar an officer of Grade pay 6000/- while she shunted out B Prasad of Grade Pay 66oo/-…… and with this order the cumulative grade pay total of the officers suspended in the first quarter of the financial year crossed the magical figure of Rs. 1 Lakh”. Public would need a ready reckoner to appreciate the boldness of the job done by Bahanji!.

Sixth CPC Report:(vi) Sample Calculations

April 2, 2008April 6, 2008 Ajit glowfriend Sixth CPC B.N. Srikrishna, Beaureucracy, Calculations of benefit, Cost of living index, Dearness Allowance, economics, Economy, finance, GoI, Government, Government of India, Government Servants, Grade Pay, India, indian economy, Pay Bands, Pay Commission, policy, Sixth Pay commission, Srikrishna

As per promise some calculations are attempted below in respect of employees & officers covered under various categories. Calculations are based on the assumption that any advance increment would not be available at the time of pay fixation,.In other words the minimum benefits have been calculted. The calculations are for pay only. Employees will also get other benefits which would be dealt with in susequent posts. Any errors may kindly be notified.Calculations are based on old DA Rates and may be subject to change if new rates effective wef 1/1/06 are applied.(Also there is a typographical error in Col.4 Row 11.Please read 1/1/07 in place of 1/1/06)

(i) The Top Brass

(ii ) The Middle Order

(iii) The Gangadeens

Sixth CPC Report:(v) Calculation of benefit in pay

March 31, 2008April 19, 2008 Ajit glowfriend Sixth CPC B.N. Srikrishna, Beaureucracy, Calculations of benefit, Cost of living index, Dearness Allowance, economics, Economy, finance, GoI, Government, Government of India, Government Servants, Grade Pay, India, indian economy, Pay Bands, Pay Commission, policy, Sixth Pay commission, Srikrishna

The uppermost question in everyone’s mind is about the quantum of benefit which would accrue for respective categories of staff. As a starting point the increase in basic pay and arrears payable based on that may be discussed. The final benefits would be subject to approvals and modification by the Government.

A number of calculators are already available on the net and calculations made by them by and large approximate to the expected benefits. However a step by step calculation is attempted here for understanding the process.

For this exercise the following issues can be taken as settled:-

(i) The benefit would be admissible from 1^st Jan. 2006 . Whether the whole amount is paid in cash or is transferred to savings would be subject to decision by the Central Govt.

(ii) The rate of dearness allowance payable (on date of pay fixation ) shall be equal to the difference between the rate of DA on 1^st Jan. 2006 (24%) and rate as admissible on date of pay fixation. DA as on date is admissible @ 47% . The difference as on date is 47-24=23%

(Warning :Subsequent comments on this post indicate that this assumption may not be correct and a new formula based on a new index may be adopted, which will reduce the quantum of benefits)

(iii) The dearness allowance under the new scales shall be payable on basic pay +grade pay .

(iv) Arrears shall be calculated taking into account six monthly increases in DA for the intervening period as shown in the table above.

(v) The report visualizes accrual of increment on 1^st July 2006 , 2007 & 2008 and one increment should accrue due to pay fixation from 01/01/06. Therefore minimum of three increments (=7.5% of basic pay as fixed on 1^st Jan 2006) would have become due at the time of pay fixation.

(vi) Since increments are to be released @2.5% of the basic pay annually ,an increase of 7.5% (three increments) may be expected due to accrual of increments at the time of pay fixation.

(vii) For the purpose of pay fixation the calculations are to be made by cross matching the basic pay being drawn with the pay and grade pay which would now be admissible with the help of table 2.2.2 shown at page 54 -70 Chapter 2 of the Report of Sixth CPC .

An illustration may be considered.

Let us consider the case of an officer in the pay scale of Rs.14300-18300 /- who is having basic pay of Rs.15500 /- at present. On 01/01/06 his basic pay would be Rs. 14700 /-. The table applicable to officers in the scale of Rs. 14300-18300 /-corresponds to Pay Band PB-3 which covers Gr. A Services of this category .

Salary under the old Pay Scales:Since at present the officer would be drawing basic pay of Rs.15500/-.Dearness Allowance calculated @47% on (Basic pay + Dearness Pay) would be payable . DA thus calculated is Rs10927/-.

Total pay on 01/01/08 under old Scale would be (15500+7750+10927)= Rs 34177/-

Salary under the new Pay scale:

As per the above table on 1^st Jan.2006.the officer would be entitled to basic pay of Rs. 25580/- and grade pay of Rs. 7600/-in the new scale which would total to Rs 33180/- Increments @ 2.5% (Rs. 830/-)each would be due on 1^st Jan. 2006 ( for pay fixation) , 1^st July 2006 & 1^st July 2007 .

Pay hike due to increase in rates of DA shall be @ 5% wef 1^st July 2006 , @6% wef 1^st Jan 2007, @ 6% wef 1^st July 2007 and 6% wef 1st Jan 2008, Totaling to 23% on date.The following increase may be assumed in the pay of the employee

(i)Basic Pay + grade pay in new scale as on 01/01/06 =Rs. 33180/-

(ii) Adding three increments @ 7.5% (Rs.830/- eachX3)=Rs. 2490

(iii) Pay after adding increments =Rs. 36670/-

(iv) Increase in DA as payable @ 23% =Rs.8434/-

(v) Total Pay on Date in new Scale of Pay = Rs.45104/-

The monthly increase is coming in the range of Rs. 11000/- per month which appears to be a bit unrealistic. If any corrections are suggested, the same would be welcome. At this rate the arrears payable may be in the range of{ Rs.8000/- (average. diff in pay) X 30} which accounts for intervening two and half years.

(If we take only two increments in this period then the jump as on date may be in the range of Rs.9000/- pm only and average increase may be Rs.6500/- pm). Those desiring exact amount of arrears may wait for some time till reliable calculators are available on the net.

Alternatively by following the above method and calculating increase based on six monthly increase in DA and annual increment in pay details can be worked out .

Some Exceptions

(i) Promotion or change of Scale of Pay between 01/01/06 and fixation of new pay

Such employees would be allowed choice of refixation of pay from the date of subsequent change in the scales of pay and would get benefit of matching pay & grade pay.

(ii) Cases of new recruitments: Pay & Grade Pay of such employees shall be fixed at the lowest pay and grade pay in the corresponding pay band. However they will get benefits of increments. For calculating the number of increments the number of years required to move from the entry grade post in the pay band to the stage of pay in the recruitment scale shall be calculated as per DOPT OM Dt. 25/5/98 (or any amended instructions applicable on the date).Number of increments shall be equal to number of such years . (If it is a bit confusing pg.52 of Chapter 2 in the report may be accessed.)

Next post : Sample calculations for Gr. B,C & D employees.

Sixth CPC Report:(iv) Pvt. Vs. Govt. Sector

March 30, 2008March 30, 2008 Ajit glowfriend Sixth CPC Minimum Wages, Parity with Pvt Sector, Private Sector, Sith Pay Commission

There have been varied responses from the Government employees to the Report of the Sixth Central Pay Commission. There are very few reactions which express satisfaction. Majority of the employees all over the country seem to be unhappy with the recommendations and have termed the recommendations as insensitive and insufficient to their needs. The frustration seems to stem from the fact that the expectation of getting salaries “at par with the private sector “ have not been met as per their interpretation of the Report. What has been overlooked is that the Commission has made sincere efforts to meet this expectation. It has tried to balance the demand with the mandate given to it for transforming the Government workforce into a modern and efficient organization.

The Commission Report says that it has attempted an in-depth study into working of the private sector and noted that the compensation structure in the private sector is quite different as compared to Government sector. Since the establishments in private sector primarily work for commercial purposes the employee‘s cost is compared to the business worth. Such comparison is not feasible in Government jobs obviously for the reason that the Government sector is primarily service oriented. Also the variation in range of salaries in private sector is quite wide .

On comparison with Government sector it noted that the salaries can be said to be definitely better in private sector only in reference to jobs which can be compared to Group A services . However in that respect the prestige and challenge offered by the Government jobs is also quite high and the Government jobs also provide incentives by way of compensatory allowances, housing and transport facilities etc.. The biggest advantage offered by a Government job is the job security attached to it and the assured retirement benefits. Commission has attempted to make the retirement benefits more attractive. It has thus attempted to harmonize the tangible and intangible benefits offered by the two sectors for achieving some element of parity.

For tackling the demand of the Government employees for making the minimum salary in the range of Rs. 10000/- per month the Commission has followed a multi pronged approach. Firstly it worked out the minimum monthly requirements for the family of lowest paid employee It has based it’s calculations keeping in view recommendations of the 15^th International Labour Conference . The expenses when calculated on a family size of three units which is the expected family size for a job entrant came out in range of Rs.5500/-per month.

(Source: table 2.2.1 Pg.53 Chapter 2 of Sixth CPC Report)

Thereafter the pay scales were fine tuned to make the minimum salary in the range of Rs. 6600/- in order to make the same approximate to the minimum needs of the lowest paid employees. Commission feels that the addition of HRA and other allowances would make it some where in range of Rs.10000/- as was demanded.

However simultaneously it also had to ensure that the relief is not considered as a windfall gain for the employees. It has therefore suggested transformation of the lowest paid employees into multiskilled workers whose skill levels could justify the higher wages. The Commission has therefore recommended that the Group D employees be converted to Group C employees in those cases where they fulfill the qualifications prescribed for Group C posts.

This would ensure that they not only get higher wages but also handle higher responsibilities. The employees who do not possess the minimum qualifications should be trained for skill up gradation and subsequent transition to Group C posts. Recruitment to Group C posts is proposed to be stopped forthwith.

Next post: Estimation of benefits in real terms

Sixth CPC Report: (iii) Concepts of Pay Band, Grade Pay , Performance Linked Incetives

March 29, 2008 Ajit glowfriend Sixth CPC

The Sixth Pay Commission has brought about certain significant changes in the pay fixation methodology. The newly introduced concepts are (i) Running Pay Bands (ii) Grade Pay (iii) Performance linked incentives. The concept of running pay bands although familiar to Armed Forces is proposed for the first time in respect of civilian employees. Running Pay bands were earlier recommended for Armed forces by Fourth CPC but were again replaced with regular scales by Fifth CPC. The Commission has attempted simplification of pay structure by reducing the number of pay grades to 20 against the prevailing 39 scales.

These reduced numer of pay scales (now referred as grades) have been clubbed together to form several distinct pay bands named as -1S,PB-1,2,3,4. Pay band –1S (Rs. 4400/–7400/-) corresponds to Group D scales marked as S-1 to S-3 by the Fifth CPC . The Commission has recommended gradual absorption of such employees in Group C posts and also recommended that no further recruitments be made in this scale of pay. The Scale would thus be phased out with passage of time. It has 3 grade pays in it’s span.

The next Pay Band PB-1 (Rs.4860/- -20200/-) covers the Group C Scales which were classified by fifth CPC as S-4 to S-8. PB-1 has 5 distinct pay grades within it.

PB-2 (Rs.8700/–34800/-) covers the Gr. B employees ( S-9 to S-15 Scales of Fifth CPC). It includes 4 pay grades within it.

PB-3 (15600/–391000/-) is the Pay Band corresponding to Group A services and has a total span of 32 years. The old scales covered by the Band are S-16 to S-27. It has total of 8 grades embedded in it’s span.

PB-4 (Rs.39200/–67000/) corresponding to Super time Scale covers S-28 to S-32 Scales of Fifth CPC and has 3 distinct grade pays corresponding to various stages of movement of the employee.

Apex Scale (Rs.80000/-) corresponds to erstwhile scale of S-33 which is the pay Scale designated for officers of the rank of Secretary Govt. of India. The Cabinet Secretary’s Scale (Rs. 90000/-) corresponds to S-34 Scale of Fifth CPC.

The Commission expects that the concept would lead to elimination of hierarchies and weed out several pay scales which had lost relevance. The concept of a continuous pay band would obviate anomalies which are generated at the various stages of pay fixation . It would also prevent stagnation in those cases where an employee has reached the maximum of his pay scale. It has been pointed out that when the recommendations of the Fifth CPC were implemented several employees reached the maxima of respective pay scales immeadiately. such a situation is required to be averted. In the proposed system any officer reaching maximum of Pay Band would be automatically rolled over to next Pay Band subject to the condition that the original grade pay would not change unless the official is formally promoted to higher Pay Band. The Commission has tried to maintain the increase in scales to the approximation of 74% which is the % increase of DA which was admissible on 1/1/06 in the pay scales of Fifth CPC.

Concept of Grade Pay:-In order provide fitment benefits in the new pay scales and also to provide for a hierarchy based structure for the various Pay bands the Commission has introduced the concept of grade pay. The grade pay for various stages have been fixed on basis of the span of original pay scale covered as well as the nature of the Fifth CPC pay scale of the beneficiary. The grade pay has been fixed in the range of 40% of the maximum of the pre revised scales (of Fifth CPC). It would change in course of time when a promotion takes place within the pay band or to the next pay band. It would also help in earmarking posts against different grades depending on the job requirement. The Grade Pay would also be taken as part of the pay for calculation of allowances including DA.

Performance linked Incentive Scheme have been conceived for PB-3 which covers the group A Services . The scheme suggests a higher rate of increment (3.5%) for good performers against standard rate of 2.5% per annum. It has been suggested that not more than 20% officers in a cadre should be covered with the higher increment category. The Commission considers this to be an innovative measure for promoting efficiency in Services.

Other innovations : The Commission has maintained a ratio of 1:12 in the minimum to maximum salary. It has also suggested that henceforth all increments be released on 1^st of July.

Cursing the Darkness

….and occassionally trying to light a candle