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Saturday 10 May 2014

                                  “Vande Mataram”        Office Tel: 011-23710231
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BPEF/7th CPC/2014                                                     Dated: 09-05-2014


            Smt. Meena Agarwal
            Govt. of India
            Seventh Central Pay Commission
            P.O. Box. No. 4599
            Hauz Khas P.O.
            New Delhi- 110 016

 Sub: Reply 7th CPC –Questionnaire

Ref:     Your letter D.O. No. 7th CPC/19/ Memorandum/6 Dated 29-04-2014 addressed to Secretary General Bharatiya Postal Employees Federation.


With reference to above cited letter, I am enclosing herewith our reply to the 7th CPC Questionnaire.

With regards,

DA: as above

                                                                             Yours faithfully,

                                                                          ( Shivakant Mishra )
                                                                          Secretary General

                                                                                                                 Answers to 7th CPC Questionnaire
1. Salaries
1.1 The considerations on which the minimum salary in case of the lowest Group ‘C’ functionary and the maximum salary in case of a Secretary level officer may be determined and what should be the reasonable ratio between the two.
        Pay determination is a mixture of efforts to settle the principal as well as system on which it is based and implemented.
         The entire concern of government is based on common good and existence of welfare state which ensures that pay and allowance of employees were not merely personnel to him but had an element of social order because these factors have intrinsic validity and have bearing on efficiency.
       Several factors such as living wages, need based minimum wage, fair comparison, supply and demand, and equal pay for equal work were studied by earlier CPCs at length and have concluded that it would not be fair to the country to encourage a claim by civil servant to be treated better than fellow countryman but in no case should the pay of an employee be less than living wage.
      As regard economic consideration for minimum wage Dr. Aykroid formula has been established and for the fulfillment of social consideration the conception of consumption unit in the family of an employee were evolved with restriction that a minimum level employee gathers this consumption unit of family after rendering five years of service. Thus the effect of these consumption units was not reflected during determination of minimum wage.
        The 3rd  CPC while calculating minimum pay vide Dr. Aykroid formula arrived at Rs 600/ but due to economic constraints of Govt. in paying the enhanced pay the minimum pay has been fixed at Rs 192.
Thus it has been made one third of living wage without any scientific idea. Resultantly successive CPC continued to provide only replacement benefit to minimum level employees. It is for these reasons central govt. pay structure have deteriorated in comparison to employees of other sector with the passage of time.
            At present MTS is the lowest category of skilled Group C . The 6th CPC evolved the cadre of MTS by amalgamating all the unskilled, semi-skilled and some of the skilled functions and making its entry level educational qualification as high school. In practice, most of the departments have outsourced the unskilled or semi skilled jobs leaving the MTS for performing skilled functions.
        The 15th Indian Labour Conference held in 1957 brought in the concept of “Need Based Minimum wage on the basis of Dr.Aykhroid formula.. The Commission is, therefore, required to determine the need based minimum wage as per the Dr. Aykhroid formula ,the social status of a high school qualifier , the compensation to skilled worker, the duties and responsibility attached to Group C post and avoid making arbitrary reduction in that wage (like not considering the effect of consumption units of family at entry level) in order to determine the actual wages of MTS as was done by earlier CPC as these tendencies have already brought us in disadvantageous position in comparison to others.
         The earlier Pay Commissions had adopted a ratio of 1:10 between minimum and maximum salary which is needed to be maintained.
1.2 What should be the considerations for determining salary for various levels of functions falling between the highest level and the lowest level functionaries?
   Since 1st CPC, it was continues endeavor of pay commissions to rationalize the pay scales and bring them at minimum possible by maintaining a balance between entry level and their career prospects i:e promotional avenues. They have also developed the concept to collect the isolated posts and place them in a cadre and place these cadres into the service.
      It seems to us proper that in absence of any distinguishable feature, the employees in different branches should be paid equally if their work, according to certain well established criteria, is adjudged to be of equal value. This is the only way by which horizontal and vertical parities among different organizations can be restored. No matter what should be the criteria for pay determination of various intermediatory level, the pay structure should be simple and rationale.
        Since the number of grades have been reduced to minimum possible the concept of job evaluation to very minute level have become redundant and instead it may be based on simple parameters of method of recruitment , the educational and technical qualification ,dealing with the public, avenues of promotion and constraints of horizontal and vertical relativities.
     The approach of the seventh CPC should be to make well defined horizontal and vertical relativities for all CG employees and the recommendation of 6th CPC about absolute parity upto Assistant level post of Head Quarter of Secretariat cadre and their field offices may extended to all Non Secretariat offices without discrimination. This will be helpful in providing effective efficient and service oriented setup.
        The sixth CPC has considered all these views positively and efficiently reduced pre revised pay scales to mere 20 grades, spread across four distinct pay band; additionally there is one apex scale and another grade for the post of cabinet secretary.
       It also owned the responsibility to restructure group C & D by the way of merging pay scales of various feeder and promotional cadres and also upgrading some of the post with recommendation to Govt. to take up initiative to restructure various other cadres further to the needs of functional requirements of the institution so that it can suit present grade pay structure and can bring sufficient monetary benefits on promotion.
The concept of Limited Departmental Exams for speedy promotion to talented employees from class C to classB and class B to class A must be resorted to.
     The skills ,the arduousness, the work atmosphere, the status the security, the prestigue, the perquisites  and every thing that are quantified and non quantified are to be considered for providing adequate pay package to the post.
     A few grades with clearly defined differences of responsibilities corresponding to different scales of pay will be acceptable, but the posts graded and paid differently yet without discernable differentiation of duties can have adverse effect on morale.  
    Further source of trouble is that if grades do not relate to recognizable difference in duties and departmental application it becomes a casual approach to evolve a cadre to the needs of organization and value of work. No post should be created, filled or held unless it is necessary and useful. Also the designation of the post should be standardized.
    The distinct Direct Recruitment with high school, intermediate, graduation and post graduation qualification must be made compulsory to cater the needs of various levels existing in an organization .In this way specialized talents in the main stream of a cadre can be inducted .After all the Govt. is investing so much budget over education upto specialized level but not utilizing them in its day to day functioning. The MACPS benefits as per cadre hierarchy and the adequate promotional benefits will take care of monetary and social status of all these employees. Now it is time time to delink hierarchical level and promotional grades for speedy decisions.    
              In respect of special functionaries like Professionals and technocrats who normally prefer to work in the Private Sector and therefore either do not offer themselves for Government service or tend to leave it and go over to the Private Sector. An equivalent pay package to group A services with speedy promotions and opportunity of lateral induction from JAG level may also be provided so that they can offer their technical experience to Govt at later period of career in the way private sector is utilizing.
            Similarly unskilled workers engaged in hazardous activities like scavenging, maintenance of rail track, in Laboratories, Hospitals may also be considered for a special treatment.
2. Comparisons
2.1 Should there be any comparison/parity between pay scales and perquisites between Government and the private sector? If so, why? If not, why not?
      The requirement of service to public without discrimination are the foccused principle of governance of Indian Govt. A civil servant is supposed to possess the qualities of being fearless but appreciative of inherent individual difficulties, non discriminatory between one citizen and the other; sense of equality; adherence to the rules and regulations etc. The private sector do not consider all these things primarily.  
      However in respect of non financial benefits the private sector have developed certain good things like induction of new recruits at various high level and reluctant about involvement of unnecessary hierarchical level in decision making which are the matters for consideration of 7th central pay commission.
2.2 Should there at all be any comparison/parity between pay scales and perquisites between Government and the public sector? If so, why? If not, why not?

Yes. For the sake of a fair comparison of wages.
2.3 The concept of variable pay has been introduced in Central Public Sector Enterprises by the Second Pay Revision Committee. In the case of the Government is there merit in introducing a variable component of pay? Can such variable pay be linked to performance?

     It will produce anomaly among similarly recruited employees and atmosphere of favoritism& discrimination and unnecessary victimization will be created which will in turn hamper the efficiency of organization.
        It is also pertinent to mention that most the western European countries, which adopted the Performance pay related scheme in civil service subsequently, discarded it as infeasible.
3. Attracting Talent
3.1 Does the present compensation package attract suitable talent in the All India Services & Group A Services? What are your observations and suggestions in this regard?

    As already mentioned that lateral entry from JAG level may also be provide to induct specialized talent able to produce desired efficieny suiting the needs of organization.Generally the pay package in Government service at all levels is at a low level compared to the exorbitant pay packets provided by some of the Transnational Corporation in the private Sector.
      Since the Group A Service officers In Civil Service enjoy enormous power, perks privileges and an incomparable job security it has continued to attract talents.
     The element of statutory Pension is one of the important and significant factor useful in attracting persons to Government service.
     Therefore, the NPS and PFRDA Act may be scrapped and statutory pension as a service condition may be restored.
3.2 To what extent should government compensation be structured to attract special talent?
Government may be required to requisition the service of personnel with special talents of professionals and technocrats for specific jobs. The Commission may devise scheme for the recruitment at JAG level and retention of such administrative professionals and technocrats with equivalent pay packets and flexible service conditions.

4. Pay Scales
4.1 The 6th Central Pay Commission introduced the system of Pay Bands and Grade Pay as against the system of specific pay scales attached to various posts. What has been the impact of running pay bands post implementation of 6th CPC recommendations?
      The Pay Band and Grade Pay system created by the 6th CPC for civil servants with only 20 grades spread over four distinct pay bands has provide better recruitment opportunities and suitable pay enhancement on promotion.
       It must be remembered that the concept has been brought to counter the reduction in pay by means of fitment formula with bunching. Movement from one pay scale to another brings about cases of senior drawing lesser pay than junior, and other pay scale related anomalies on providing replacement benefits on revision of pay by pay commission. No point to point fixation benefits are guaranteed in pay scale system. This system is far better than pay scale structure, in vogue, upto 01-01-2006.  
      The anomalies of varied nature seen in pay of employees are primarily due the faulty MACPS provisions of providing grade pay hierarchy instead of cadre hierarchy and not providing any benefit on promotion to a post having higher duties and responsibility.
4.2 Is there any need to bring about any change?
 The changes will be suggested at the appropriate stage of questionnaire.
4.3 Did the pay bands recommended by the Sixth CPC help in arresting exodus and attract talent towards the Government?
The present structure have provided better basic pay in comparison to banks and other organizations to talented youths and therefore have attracted them to take entry in govt. service.
The Pay Band & Grade Pay structure prevented the highly qualified technocrats and professions to leave the Government in search of better career avenues in public and private sectors.
4.4 Successive Pay Commissions have reduced the number of pay scales by merging one or two pay scales together. Is there a case for the number of pay scales pay band to be rationalized and if so in what manner?
It must be noted that the successive Pay commissions had reduced the pay scales primarily at the Group C and D levels. Now the time has come to employ the mind to bring minor changes to produce uniformity.
    There is scope to have further exercise in respect of merging the grade pay of 1900 and 2000 and placing all post existing in these grade pay at 2400. The post at grade pay 2400 may be placed at 2800 and the post at 2800 may be placed at 4200.  The grade pay of 4600  is producing anomalies among similarly placed employees in pre revised 6500--10500 as some of them are placed in grade pay of 4800 and some are placed in 4600.Thus grade pay of 4600 may be merged with 4800.
4.5 Is the “grade pay” concept working? If not, what are your alternative suggestions?
Yes it is working completely and efficiently
5. Increment
5.1 Whether the present system of annual increment on 1 July of every year uniformly in case of all employees has served its purpose or not? Whether any changes are required?
No. In fact the single date increment system has brought in anomalies In our Opinion, the commission must recommend, for administrative expediency, two specific dates as increment dates. Viz. 1st January and 1st July. Those recruited/appointed/promoted during the period between 1 Jan and June, will have their increment date on l January and those recruited/appointed/promoted between 1st July and 31st December will have it on 1st July next. This apart the Commission is required to specifically recommend that those who retire on 30th June and 31st December are granted one increment on the last day of their service.
5.2 What should be the reasonable quantum of annual increment?
More important assurance to employees should be that his emolument will not erode by increase in cost of living and the Govt. will make efforts to provide as much relief as possible when the degree of tolerance is exceeded. To save him from that predicament, the compensation has to be provided for not only for the present also for the future. It is also necessary that a scientific and defined formula may be devised and it should be formulated well in advance
The reasonable quantum of increment should not be less than 6.25% of the basic pay
5.3 Whether there should be a provision of variable increments at a rate higher than the normal annual increment in case of high achievers? If so, what should be transparent and objective parameters to assess high achievement, which could be uniformly applied across Central Government?
Without defining the term “high achiever” and prescribing transparent and objective parameters to assess high achievement the system of variable increments at a rate higher than normal annual increments will be misused on subjective assessment of high achievements. For these reasons the scheme of variable increment is not desirable.
5.4 Under the MACP scheme three financial up-gradations are allowed on completion of 10, 20,30 years of regular service, counted from the direct entry grade. What are the strengths and weaknesses of the scheme? 
Is there a perception that a scheme of this nature, in some Departments, actually incentivizes people who do not wish to take the more arduous route of qualifying departmental examlnations/ or those obtaining professional degrees?
The strength of the system is that it has eased stagnation concerns and the financial benefit were provided necessarily after lapse of definite period of service.
    The weakness of the scheme is that it has not been formulated properly and the orders issued by the govt. have not been implemented properly. Also no precaution has been taken by  departments in switching over from then existing schemes of ACP(benefit after 12 & 24 year)  and TBOP & BCR scheme (benefit after16&26year) with this benefit after10,20& 30  year of regular service. Resultantly seniors are drawing lesser salary than juniors of the previous scheme unnecessarily. Promotion of every kind i:e either through limited departmental exams or from seniority should not have been counted for providing MACPS benefits. The provision of not providing any financial benefits on promotion to post of higher responsibility is also not correct provision as it draws reluctance to earn promotion.
      Supreme Court of India has also upheld lower court decisions of providing MACPS benefit in promotional hierarchy instead of grade pay hierarchy. It has also upheld that stepping up in pay may be granted in case senior drawing lesser pay than juniors due to grant of MACPS/ACP benefits
   The 7th CPC has to take into account these irregularities into account to make this MACPS a success efficient. Apart from it there should be 5 financial upgradation in the departmental promotional hierarchy. MACP is a time bound promotional scheme, The scheme is required to be continued to motivate personnel at all levels and at all departments especially in those organizations, where normal promotional avenues are few and far between. Normal promotions are dependent upon the availability of vacancies at higher levels. The job requirement of certain organizations may not be capable of creating requisite number of higher level positions whereas it might need large number of personnel at lower levels. MACP alone can take care of that specific situation. The arduous route of career progression through examination and professional qualification, no doubt will be preferred if and if only such promotions are made available for the eligible candidates within a reasonable period of residency in the feeder cadre.
6. Performance
What kind of incentives would you suggest to recognize and reward good performance?
We are against the system of incentives to reward good performance as this would only encourage favouritism and nepotism.
7. Impact on other organizations
Salary structures in the Central and State Governments are broadly similar. The recommendations of the Pay Commission are likely to lead to similar demands from employees of State Governments, municipal bodies, Panchayati raj institutions & autonomous institutions.
To what extent should their paying capacity be considered in devising a reasonable remuneration package for Central Govt. employees?
Capacity of a Governmental organization to pay cannot be gauged only from the available resources but also its potential to raise resources. Wages cannot be determined on the single factor of capacity of the Government to pay. It must be noted that there are various State Governments in the country which pay better pay packets, perquisites and allowances to its employees than what is provided to the Central Government employees. Panchayati Raj institution, Municipalities, normally follow the salary structure of the respective State Governments. It is also to be noted that various State Governments do revise the wages of their employees once in five years. In any case the incapacity of the government to pay cannot be a justification to deny the minimum wage to workers and the salary structure based upon that concept, especially in the background that the government is to function as a model employer. It also cannot be an excuse for denial of wages on a fair comparison of the wages existing in the society which is evolved as a product of collective bargaining of the workers.
8. Defence Forces
8.1 What should be the considerations for fixing salary In case of Defence personnel and in what manner does the parity with civil services need to be evolved, keeping in view their respective job profiles?
No comments
8.2 In what manner should the concessions and facilities, both in cash and kind, be taken into account for determining salary structure in case of Defence Forces personnel.
No comments
8.3 As per the November 2008 orders of the Ministry of Defence, there are a total of 45 types of allowances for Personnel Below Officer Rank and 39 types of allowances for Officers. Does a case exist for rationalization/ streamlining of the current variety of allowances?
No comments
8.4 What are the options available for addressing the increasing expenditure on defence
No comments
8.5 As a measure of special recognition, is there a case to review the present benefits provided
to war widows?
No comments
8.6 As a measure of special recognition, is there a case to review the present benefits provided
to disabled soldiers, commensurate to the nature of their disability?
No comments.

9. Allowances
9.1 Whether the existing allowances need to be retained or rationalized in such a manner as to ensure that salary structure takes care not only of the job profile but the situational factors as well, so that the number of allowances could be at a realistic level?
The existing allowances need to be retained. They are at a realistic level having been evolved by successive Pay Commission over detailed deliberations.
9.2 What should be the principles to determine payment of House Rent Allowance?
The house rent allowance will have to be the actual rent payable by an employee in a particular location. The experiences show that the HRA for class C cities should be not less than 20% of basic pay. The HRA for class B city should be 30% and that of metro city should be 40% of basic pay.
10.1 The retirement benefits of all Central Government employees appointed on or after 1.1.2004 are covered by the New Pension Scheme (NPS). What has been the experience of the NPS in the last decade?
We are of the considered opinion that the new pension scheme which came into existence for the employees recruited after 1.1.2004 must be scrapped. The old statutory pension scheme as was in vogue prior to 1.1.2004 must be made applicable to all Government employees irrespective of the date of their entry into Government service. The New pension scheme has in fact created a class within class amongst the Central Government employees which is discriminatory and impermissible. It is clearly in contravention of the dictum pronounced by the Constitution Bench of the Supreme Court in Nakara Vs Union of India and therefore deserves to be rescinded. Since this New Pension Scheme has been introduced with effect from 0101.2004, it will come into operation only after 30 years in the year 2034 or so when present new entrants retire and get pension from annuities purchased from 40% of total accumulated pension fund.
10.2 As far as pre-1.1.2004 appointees are concerned, what should be the principles that govern the structure of pension and other retirement benefits?
The concept of modified parity introduced by the 5th CPC as a measure to reduce the financial implication must be replaced with the full parity concept as was made applicable for the personnel retired prior to 1.1.1986. In other words, the pay of every retired person must be re-determined notionally as if he is not retired and then his pension to be computed under the revised rules. This alone will protect the value of pension of a retired person.
5th CPC in their Para 127,6 has observed, “It needs to be averred emphatically that pension Is not in the nature of alms being doled out to beggars. Senior Citizens (Retired Government employees) need to be treated with dignity & courtesy benefitting their age. Pension is their statutory, inalienable, enforceable right & it has been earned by the sweat of their brow” Hon’ble Supreme Court, in its landmark 5 Judge Constitutional Bench judgement dated 17.12.1982 in the case of D.S. Nakara Vs Union of India ruled - “A Pension scheme consistent with available resources must provide (adequate pension) so that the Pensioner would be able to live
I) free from want, with decency, independence and self respect and
ii) At a standard equivalent at pre-retirement level.Ii) Pensioners from payment of pension form a homogenous class. Different formulae affording unequal treatment cannot be adopted to compute their pension solely on the ground that some retired earlier and some retired later.
A comprehensive scheme of retirement benefit has been suggested by the stake holders both as an agenda in the National Council meeting of JCM and the meetings of SCOVA. The Commission is requested to consider the well thought out scheme formulated in those agenda and make recommendations to the Government, so that the pension and retirement benefits will really become meaningful for the retired employees. We shall elucidate the points in detail when we submit the memorandum to the Commission on retirement benefits.
11. Strengthening the public governance system
11.1 The 6th CPC recommended upgrading the skills of the Group D employees and placing them in Group C over a period of time. What has been the experience in this regard?
The then existing Group D employees, to the best of our understanding have all been trained, upgraded or promoted to function as skilled group C employees.
11.2 In what way can Central Government organizations functioning be improved to make them more efficient, accountable and responsible? Please give specific suggestions with respect to:
a) Rationalisation of staff strength and more productive deployment of available staff;
b) Rationalisation of processes and reduction of paper work; and
c) Economy in expenditure.
Whatever rationalization effected so far by the Government had been through an unscientific and arbitrary executive fiat like the one issued in 2001 and which was kept operative till 2009. The said exercise only reduced the staff strength drastically. We arenot aware of any rationalization or reduction in Group A cadres through this exercise even though the executive instruction covered all grades and cadres in the Government service. It in effect made most of the departments of the Govt. of India either non functional or dysfunctional. In our considered opinion, the 7thCPC must recommend to the Government to set up a Committee in each department with experts from outside the organization, the officials from within the organization and representative of the Unions of the respective department to study the functional changes taken place over the years, especially due to the induction of modern technology the new challenges and the best way to meet those challenges’ reduction in paper work, customer satisfaction and economy in expenditure and make suggestions to the Government for their acceptance and implementation in toto.12. Training! building competence To ensure that periodical professional training is imparted to all personnel to update the skills.
12.1 How would you interpret the concept of “competency based framework”?
No comments. 
This in fact is a matter which must be considered by an Administrative Reforms Commission rather than a Pay Commission.
12.2 One of the terms of reference suggests that the Commission recommend appropriate training and capacity building through a competency based framework.
a) Is the present level of training at various stages of a persons career considered adequate? 
Are there gaps that need to be filled, and if so, where?
b) Should it be made compulsory that each civil service officer should in his career span acquire a professional qualification? If so, can the nature of the study, time intervals and the Institution(s) whose qualification are acceptable, all be stipulated?
c) What other indicators can best measure training and capacity building for personnel in your organization? Please suggest ways through which capacity building can be further strengthened?
In our opinion in- service training is the best course for skill development. Outsourcing of Governmental functions per se is undesirable and must be stopped.
13.1 What has been the experience of outsourcing at various levels of Government and is there a case for streamlining it?
The experience has been sheer duplication of work by existing regular employees and deterioration of efficiency in pubic service.
13.2 Is there a clear identification of jobs that can be outsourced?
No. for reasons stated in reply to question No. 13.
14. Regulatory Bodies
No comments.
14.1 Kindly list out the Regulators set up under Acts of Parliament, related to your Ministry! Department. The total number of personnel on rolls (Chairperson and members + support personnel) may be indicated.No comments. The reply has to be given Government Departments.
14.2 Regulators that may not qualify in terms of being set up under Acts of Parliament but perform regulatory functions may also be listed. The scale of pay for Chairperson /Members and other personnel of such bodies may be indicated.
No comments. The reply has to be given Government Departments.
14.3 Across the Government there are a host of Regulatory bodies set up for various purposes. What are your suggestions regarding emoluments structure for Regulatory bodies?
No comments.
15. Payment of Bonus
One of the terms of reference of the 7th Pay Commission is to examine the existing schemes of payment of bonus. What are your suggestions and observations in this regard.
The 7th CPC must make note of the recommendations of the 5th CPC & Bazle Karim Committee Report which are yet to be acted upon by the Government. The present system of Productivity linked bonus is the product of bilateral agreements and cannot be changed through unilateral decisions. It has been decided that bonus is the way to compensate the difference between actual and living wage.
      Since govt. always try to make this difference by way of its arbitrary exercise of authority in devising minimum wage. It should also be ensured that actual amount of bonus be paid instead of making ceiling over it.
                                                    ( SHIVAKANT MISHRA)
                                                      Secretary General

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