Monday, December 22, 2008

Govt agrees to most of the armed forces' pay hike demands

While rejecting uniform grade pay for military officers on par with their civilian counterparts, the government seems to have more or less agreed to the other three demands of armed forces over their new revised pay scales.

The "decision'' of the three-member ministerial committee, headed by foreign minister Pranab Mukherjee, is to be officially announced in the next few days.

Sources, however, said there were indications the government had given the go-ahead to the elevation of Lt-Colonel rank officers to a higher pay scale; placement of a majority of Lt-Generals in the new "higher administrative grade-plus'' with police DGPs; and restoration of the reduction in pension for jawans.

The government, however, has apparently rejected the fourth "core demand'' of granting uniform grade pay to officers of armed forces on par with civilian officers, said sources.

As reported earlier by TOI, the armed forces blame "bureaucratic subversion'' for introducing "far more serious anomalies'' in their pay scales rather than resolving the ones present in the 6th Pay Commission report.

The armed forces, in fact, hold that their extant parity with their civilian and paramilitary counterparts had been "destroyed'' by the new pay scales. They were particularly upset over the "extant parity'' of Lt-Col rank officers being lowered by retaining them in Pay Band-3 (Rs 15,600-39,100), while raising similarly placed civilians and paramilitary officers to PB-4 (Rs 37,400-67,000).

The "lowering of status'' of Lt-Cols and their equivalent ranks in IAF (Wing Commander) and Navy (Commander) hit the armed forces the most since they constitute the bulk of the fighting force among officers. Almost 18,950 of the 54,770 officers in the forces, after all, are Lt-Col rank officers.

New HBA policy being delayed

The economic downturn seems to be delaying the announcement of a new home loan policy for Central Government employees as recommended by the Sixth Central Pay Commission (CPC).

Known as the house building assistance (HBA), it’s a key interest-bearing advance given by the government to its employees to construct/acquire house/flats of their own.

The HBA is given to all permanent employees, members of All India Services (IAS, IPS & IFS) deputed to the Central government, public sector undertakings (PSUs) under control of the Centre, international organisations, autonomous bodies etc. The advance is to assist acquiring a plot and constructing a house thereon, building a new house on a plot already owned singly or jointly with spouse, enlarging living accommodation in a house, purchase of a ready built house/flat etc.

According to existing rules, the cost of the house (excluding cost of land) should not exceed 134 times the basic pay (and dearness pay taken together) subject to a maximum of Rs 18 lakh and a minimum of Rs 7.5 lakh.

Although this advance is interest-bearing, it has an inherent subsidy since interest is has to be paid only after the principal has been repaid and simple interest is chargeable on the advance. The rates of interest, therefore, are somewhat lower than existing market rates.

The Sixth Central Pay Commission in its report said: “It is desirable to provide only for the element of interest subsidy and make available various interest bearing advances to government employees through arrangements with public sector banks. This will not only give the government employee the freedom to approach the specified bank for a loan but would also simplify the existing procedures saving a lot of administrative work which is presently being done in government offices for grant of loans and servicing thereof.”

The CPC recommended the government should enter into an agreement with leading PSU banks to extend this facility at pre-determined competitive rates to its employees. The employee shall take the loans/advances directly from the bank with the approval of the sanctioning authority in the government and repay installments directly to the bank.

The Sixth CPC also said: “The eligibility for taking the advances should also be removed because the repaying capacity would, in any case, be considered by the concerned bank at the time of processing the loan application. This will also extend to the ceiling of Rs 18 lakh presently prescribed on the cost of house for purposes of house building advance. Therefore, this ceiling should also be removed.”

But this policy has not been implemented till date. The Ministry of Finance in a notification dated October 24 said: “The implementation of the recommendations of the Sixth Central Pay Commission relating to interest bearing advances granted to government employees is under consideration of the government. Meanwhile, pending finalisation of the new arrangement, the existing provisions for interest-bearing advances to purchase motor car, motorcycle, scooter, moped and personal computer would continue to be in operation.” But it was silent on the HBA.

Friday, December 12, 2008

Hyundai extends discount scheme for govt employees till Dec

The country's second largest car maker Hyundai Motor India today said it has extended the discount scheme for government and public-sector units employees till December this year on account of 
encouraging response from the consumers. 

"We value the government employees and are pleased with the tremendous response that we have received from them. We have extended the scheme so that more and more government employees can be benefited," Hyundai Motor India Senior Vice President (Marketing and Sales) Arvind Saxena said in a statement.

Under the scheme, special pricing and attractive finance options are available to enable the government employees and this would be in addition to the full benefit of the reduction in CENVAT by four per cent.

This scheme, applicable to the entire product range of Hyundai, would also include exchange bonus of up to Rs 20,000.

The company would offer a total discount between Rs 22,200 and Rs 46,660 on various Hyundai cars, the statement said.

To provide finance options, Hyundai has tie-ups with State Bank of India, Axis Bank and HDFC Bank, it added.

SC comment : The  prices of the cars may come down further. Just wait for some time as no scope of increase in near future.

Govt panel for sacking of babus if found unfit after 20 yrs service

In an attempt to make bureaucracy accountable, a radical system of assessment has been mooted by an official panel allowing government servants to be sacked after 20 years of service if they are found unfit to continue.
The Administrative Reforms Commission (ARC) headed by senior Congress leader M Veerappa Moily recommended unprecedented and far-reaching changes in the service rules of government servants and suggested two intensive reviews to make civil servants accountable.

The first of its kind report in 150 years suggests far-reaching recommendations, including removal of non performing bureaucrats and perhaps even a formal degree in public policy.

The report on 'Refurbishing of Personnel Administration' said the first review at 14 years would primarily serve the purpose of intimating to the public servant about his or her strengths and shortcomings, while the second review at 20 years would mainly serve to assess the fitness of the officer for further continuation in service.

"The services of public servants, who are found to be unfit after the second review at 20 years, should be discontinued. A provision regarding this should be made in the proposed Civil Services Law," the second ARC said in its latest report released today.

To ensure better accountability, the 377-page report said that for new appointments, it should be expressly provided that the period of employment shall be for 20 years. "Further continuance in government service would depend upon the outcome of the intensive performance reviews," it said.

"The ACR will not exist in its present form," M Veerappa Moily, who heads the panel, told reporters at a press conference where he released the report.

In the aftermath of Mumbai terror strikes, as political heads roll, the report is being seen as the government’s effort to bring babus within the accountability umbrella.

Sensing massive public outcry, the politicians have closed their ranks to send a positive message to the people that they are united in their war on terror. Hence the pressure is on the babus to follow suit.

Following are the three key recommendations of the panel:


The officers can be removed within the 14th and the 20th year of an officer’s tenure.

To encourage bright candidates for a long stint in the services, the upper age limit is also being lowered to 25 years for general candidates.

A formal degree in public policy and management is also being proposed.

"The first review will be held after 14 years and the second one after 20 years. It will assess whether the officer is fit to continue. If the recommendations are followed it will end the politician- bureaucrat nexus,” says Administrative Reforms Commission Chairman, Veerapa Moily.

Among the high-profile bureaucrats getting to complete their tenure is the troika responsible for maintaining internal security: National Security Advisor MK Narayanan, Intelligence Bureau Chief PC Haldar and Research and Analysis Wing chief AK Chaturvedi.

"The time has come for bureaucrats to put their hand up and be counted,” says ex-IPS officer Ved Marwah.

Key recommendations:

Government servants could lose their job after 20 years of service if they failed to come up to the expectations of their superiors.

The report on 'Refurbishing of Personnel Administration' said the first review at 14 years would primarily serve the purpose of intimating to the public servant about his or her strengths and shortcomings, while the second review at 20 years would mainly serve to assess the fitness of the officerfor further continuation in service.

To ensure better accountability, the 377-page report said that for new appointments, it should be expressly provided that the period of employment shall be for 20 years. "Further continuance in government service would depend upon the outcome of the intensive performance reviews," it said.

It also said that performance appraisal should be year round and provisions for detailed work-plan and a mid-year review should be introduced for all services.

Noting that a good employee performance appraisal system was a pre-requisite for an effective performance management system, the Commission suggested making appraisal more consultative and transparent.

The report said the annual performance agreements should be signed between the department minister and the secretary of the ministry or heads of departments, providing physical and verifiable details of the work to be done during a financial year.

The actual performance should be assessed by a third party with reference to the annual performance agreement, it said.

For motivating civil servants, the report said, there was a need to recognise their outstanding work.

It said selections of foreign assignments should be made on the basis of recommendations of the Central Civil Services Authority.

On disciplinary proceedings, it said the proposed civil services law should have a provision that the present oral inquiry process is converted into a disciplinary meeting or interview to be conducted by a superior officer in a summary manner without the trappings and procedures borrowed from court trials.

On relations between political executive and civil servants, the panel said there was a need to safeguard the political neutrality and impartiality of the civil services.