Cabinet clears setting up of Sixth Pay Commission
It may not be all good news for the Government servants, for the FM is our own PC, who is doing a hat trick with the Pay Commissions. He was Rajiv Gandhi’s minister for personnel and had a great role to play in the Fourth Pay Commission Report. He was the Finance Minister when the Fifth Pay Commission Report was implemented, much against his will. He stoutly opposed its implementation and Prime Minister Gujral had to prevail upon him. Three years ago I attended a meeting of businessmen addressed by PC. I was squirming in my seat as a businessman asked, “ In spite of your personal opposition, why did you allow the fifth Pay Commission report to be implemented pushing this country into a huge deficit”. I was thinking that I was a poor underpaid government servant and here was a rich business man questioning the former finance minister for giving me a small hike, which inflation and liberalization swallowed with a vengeance. But what shocked me was PC’s answer. “ I am happy that there are some people in this country who remember that I was opposed to implementing the Fifth Pay Commission’s report as it would be disastrous”, He said. “But I was helpless”, he continued,“ leaders of every political party in the country came to me and asked me to implement the report.”
Are our babus well paid? Certainly not, especially after the software boom. I know an IRS officer of the latest batch struggling to make both ends meet with his salary of Rs. 15,000/- in a big city. Four years ago this boy who was an engineering topper was offered a software job while he was in his final year. He refused that and spent two years preparing for the civil services. I am afraid this boy cannot remain honest for long! I know SDRs who travel by public transport to reach the Tribunal to defend Crores of rupees for the government against high paid lawyers.
It is a myth that salaries of babus eat away a major chunk of government expenditure – it is not true at least in the case of the Central Government. Already the press has decided that babus are going to get a bonanza. 20,000 Crores for the babus screams a headline. Where did they get that figure from? The PIB release said that the last pay commission had an impact of 17,000 Crores. So somebody made a quick calculation and arrived at the figure of 20,000 Crores. And what is the strengths of the Central babus? Newspapers have put the figure between 3.3 Lakhs to 5.5 millions.
Whatever you do the maximum benefit an employee is going to get through the pay commission is Rs. 1500 per month, about 20% of which you can recover as income tax and about 50% can be recovered through indirect taxes. What is left will be absorbed by the market as tomorrow prices will go up on the assumption that government employees are going to get a huge hike!
TIOL will extensively cover the issues before the Sixth Pay Commission. To start with, look for our piece MS Groom by one of our popular authors in the Guest Column on Monday.