Friday, July 28, 2006

We must scrap Pay Commissions

'We must scrap Pay Commissions'
Bibek Debroy, secretary general, PHDCCI

July 24, 2006

Last week, the Manmohan Singh Cabinet set up the Sixth Pay Commission that will determine the wages of central government employees for the next 10 years.


India Inc has reacted strongly to the constitution of the new pay panel. Apex business bodies like the Confederation of Indian Industry (CII); the Federation of Indian Chambers of Commerce and Industry (FICCI); and the Punjab, Haryana and Delhi Chambers of Commerce and Industry (PHDCCI) argue that the new pay commission recommendations, when implemented, would stifle the country's economic growth.


The Fifth Pay Commission was set up in 1994. And when it was implemented in 1997, it created an additional burden of Rs 17,000 crore (Rs 170 billion) per year on the government's finances. Many state governments couldn't bear the burden of the hike at the time, forcing the central government to devise a financial bailout package for them.


So, why did the government hastily set up the Sixth Pay Commission? One expert who has voiced his concern on the new Commission is Bibek Debroy, secretary general, PHDCCI.


A wellknown economist, Dr Debroy served till last year as the director of Rajiv Gandhi Institute for Contemporary Studies in New Delhi.
In an exclusive interview with rediff.com Managing Editor George Iype, Dr Debroy explains how damaging can the Sixth Pay Commission be for India.


Why do you think Prime Minister Singh decided to set up the Sixth Pay Commission?


That is something that the government has to answer. But the irony is that the government has set up the Sixth Pay Commission without implementing the recommendations of the Fifth Pay Commission. There were many measures that the Fifth Pay Commission had recommended: like downsizing the government and going forward in administrative reforms.


While recommendations on downsizing and wage increases linked to productivity were ignored, the increase in wages and salaries was implemented. Sadly, the government implemented the recommendations pertaining only to wages and salary hikes.


The state governments have also followed suit. The result was that the Fifth Pay Commission recommendations completely ravaged the finances of the central and state governments.


What will be the effect of the Sixth Pay Commission?


We do not know what will be the recommendations of the new Pay Commission. But I am sure it will increase inflation and stifle economic growth. Also, once the impact on states and other quasi-government bodies is factored in, the Sixth Pay Commission will cost 1.5 per cent of GDP, something India cannot really afford.


This represents regressive transfers from the poor of the country. The poor pay through higher taxes for a salary budget that could have been spent on physical and social infrastructure.


Do you think setting up the new Pay commission is a regressive move?


Yes, it is a regressive move. First of all, where does the money come from to give higher salaries to millions of government employees? The Pay Commission recommendations on salary increases benefit 4.2 million central government employees, and 20 million state government employees when the recommendations eventually trickle down to states. But this hike is paid for by the 380 million who work outside the government.


Soon after the implementation of the Fifth Pay Commission in 1997, the government had set up the 10th Expenditure Reforms Commission. It had also suggested that downsizing the government was the most urgent issue. What happened to that recommendation?


Look, a number of commissions like the last Pay Commission and Expenditure Reforms Commission had recommended downsizing the government. But nothing has been done on this front for long. Ironically, the central government claims that its workforce has reduced in the last few years. But it is all a sleight of hand.


The corporatisation of the BSNL (Bharat Sanchar Nigam Ltd) reduced the workforce in good numbers. But that is not the 'means' under which the workforce should be reduced. Actually, the number of employees in the government -- the central government and the states -- has not reduced.


Do you think autonomous bodies under the government are also eating into the exchequer? It is said there are more than 300 autonomous bodies under the central government and their cost of operation every year is around Rs 8,000 crore (Rs 80 billion).


All these autonomous bodies should be turned into self-financing bodies. They should only be given some capital expenditure to run.


Do you think there is political pressure behind the setting up of the Sixth Pay Commission? Especially from the Left parties?


Setting up the Pay commission was a collective political gambit. It is not just the Left parties alone that wanted the Commission. In fact, Prime Minister Manmohan Singh had announced the setting up of the commission in February without consulting the state governments. There was a consensus that the central government must consult the states before setting up the crucial commission, because if pay hikes are implemented for central employees, naturally the states have also to raise the salaries.


But only after the central government announced that it is setting up the Commission, did it start consulting the states. I think it is a political game by the Congress party itself. Maybe they are looking at elections in 2009. They may be thinking that it will favour them politically it they can execute the Sixth Pay Commission before the next general election.


Do you need India needs such commissions?


What is the need for a Pay Commission? It has an archaic model up. It was first set up in 1956. Since then we have religiously continued setting up the Pay Commissions! It is high time India scraped the system of setting up Pay Commissions. If public sector undertakings want to increase salaries to their employees, let them do it. Let us set up a collective bargaining mechanism instead.


What do you mean by collective bargaining?


Government employees do not come under the purview of either the Trade Union Act or the Industrial Dispute Act. Rule 7 of the Central Civil Services (Conduct) Rules, 1964, prohibits government employees from going on a strike. It effectively means that government employees do not have collective bargaining power which is available to workmen in other industries and in the private sector.


I feel government employees should be given collective bargaining rights. This will help them to argue for a wage hike in accordance with their performance and calibre and they can actively negotiate with the government as a matter of right.


The government should facilitate this by amending the Trade Union and the Industrial Dispute Acts. This will ensure that there would be no need for further pay commissions from time to time.

(This interviews was published in www.rediff.com and taken with thnaks)
Published at http://inhome.rediff.com/money/2006/jul/24inter1.htm

42 comments:

  1. Anonymous11:40 AM

    The ‘wellknown economist’ has presented a biased view, not based on ground realities, and states half truths as facts.
    Did the government hastily set up the Sixth Pay Commission? In fact the setting up of the commission is much belated. The Fifth Commission itself had stated that the Sixth Central Pay Commission be appointed by the year 2003 so that new pay scales for the Central Government employees could be made effective from 1.1.2006. The NDA government did not act in time and the present government had set up the Commission during the second half of 2006, when actually the report should have implemented by 1.1.2006. Still the article above says the government hastily set up the Sixth Pay Commission……!
    Wasn’t there reduction in the workforce in central government?. Even a common man knows that there had been considerable decrease in the recruitment to government sector, and for the last several years, one third of the vaccancies are only being filled up. About which 4.2 million central government employees, the “economist” is talking? In fact there are now only 3.2 million of them. You can wake up a person who is sleeping, but what about a person who pretends as sleeping?
    The funniest part of it all is the economist’s concern about the poor….! “The poor pay through higher taxes for a salary budget that could have been spent on physical and social infrastructure”, says he. Why the great man does not worry about the high salaries in the private sector, which eventually will pass to the common man if not in the form of taxes, as increased rate in the price of products and services, as the end use customer? “This hike is paid for by the 380 million who work outside the government” says the ‘economist’. The first thing to be noted in this regard is that though the number of government employees sounds as very large, while considering the population of the country it is not up to the mark of developed countries. India has a population of more than 130 crore. What does the ‘economist’ say about the population - bureaucracy ratio? Is it not the government machinery that had facilitated for the development process of the nation, and economic progress? Who except the public exchequer has to pay the public servant? One more point Mr. Economist, the government employees also pay tax, and they are the only category of people who pay correct tax.
    What about the hike in the prices and cost of living? Is the government employee to live a beggers life?
    Who’s interest in fact these ‘Economists’ are trying to protect, pretending as the protectors of the nation and the general public?. In fact they are just trying to protect the interests of the capitalists inside and outside the country. They are not worried about the finance of the country. The same economists will protest if the government imposes restriction on fringe benefits on high rate private sector salaries, by which the private sector usually avoid tax. They favour tax relaxation by way of SEZ s. How does these all help the above mentioned poor?
    Infact these agents of the capitalists do not want the talent to go to government sector. They want the government to be manned by unfit and unsatisfied employees. They want the pay in government sector to remain a pittence, which will compell the employees to become corrupt . Then only they will be able to manipulate the system as they wish and to protect their interests.

    ReplyDelete
  2. Anonymous12:57 PM

    I toatally agree with the author of the comments (annonymous)on this interview. Those who advocate against pay hike for Government officers, want to make sure that the best talent should be available outside, for them, and for the outsourcing US companies at cheaper rates. They also want the government employees to be corrupt.

    ReplyDelete
  3. Anonymous6:45 PM

    Yet another great person has written elsewhere that with the money spent to pay salaries to the government employees, 47 IIMs can be established!. I have not heared anything as foolish as that in the recent years. Are the IIMs solutions for all the problem the country faces? There is no need for any governance in the country - all that it needs is only some factories to produce good managers for the private sector? No post office, health centre needed in the remote villages? No police stations? And will the IIM graduates go and guard the boarder in Kashmir....?
    The problem is with the media, who give undue importance to all this foolish utterance by the so called 'Economists'.
    Many of them have become economists after their failure in the Civil Service Examinations.

    ReplyDelete
  4. Anonymous6:57 PM

    Ignor this Bibek Debroy yaar....

    ReplyDelete
  5. Anonymous3:04 PM

    The views of Bibek Roy and people of such mean mentality is highly biased and pro private sector. He has ignored the pay packets the private sector is offering its employees and the economic boom the country is witnessing today. Does he think the public service has no participation in the country's development? In fact each and every citizen contributes towards nation building in one way or the other. When the Government has taken the necessary steps to give her employees the due they deserve, what ails the people like Roy to stifle the initiative of the Government?

    ReplyDelete
  6. Anonymous12:58 PM

    Definitely, we must scrap pay commissions. But, be sure that if Government can’t pay reasonably and do justice and welfare for it’s employees, there is serious doubt that it would be able to do justice and welfare of rest of the citizens.

    ReplyDelete
  7. Mr Economist, You are Great Saviour of the Poor.I entered service in 1989 with M.E Degree in Central Govt Service for a Gross Salary of Rs3210/(Dec,1989).My classmate joined private concern for Rs3000/ gross per month at the same time.Today after 17 years of service my Gross is Rs25000/ per month, my Classmate entered private concern is drawing
    Rs 2Lac per month.How do you compare this case.Will you agree that Govt should put a freeze on salary hike to Private sector also.Same Qualification in Govt/Private should have same salary, Private should be restricted to pay at the same level Govt pays.Will you agree for this.

    ReplyDelete
  8. Anonymous5:04 PM

    Yes i agree with Mr. Khaja Syed. In addition to his comments, I would like add. I would rather say that Government must pay better than private sector. In the name of economy such economists are loosing thousands and thousands of crores of Government (public) money by giving unnecessary over-incentives to private companies (SEZs etc.) and mindlessly putting at disadvantage the meagre number of government employees by cutting them in number and pay. I would rather say that Indian economy is running on Government employees and they should must be paid over and above the private sectors.

    ReplyDelete
  9. For example,Tata motors will just pay a lease rental of just Rs 20/-crores over 60 years period for about 600 Acres of land at Singur(West Bengal)and in addition has also be given Tax subsidy of Rs100/crores.Can you expect any where in world such a concession will be given to private sector other than in India.Poor farmers land is acquired after killing them(see Nandigram,West Bengal).Private Sectors have not paid more than Rs 50000 crores loan taken from Banks in the last 50 years and have not paid tax liability of more than Rs 85000/-Crores during the last two decades to Income tax department have no moral right to talk against appointment of sixth pay commission

    ReplyDelete
  10. Anonymous10:48 PM

    Instead of going for useless committee fixing the pay scale for the last several decades, some new strategies to be followed to cope with scientific advancements. Political people are doing gimmick always in this form of new pay for their continued existence. They must control inflation rate to a good level not affecting a single poor person for his daily survival.

    Pay for work should be implemented in all public sector and educational institutions also. How many teachers have got valid or good degree/qualification? Do they really work equivalently for their salary? How many institute outputs (ie; degree holders really brilliant) possess stuff? Today everything go(es) behind money. In view of this, today no distinction between good and bad can be made. Therefore in my view all being paid enough and there is no need to have 6th pay implementation and rewards should be implemented like Pay for work.

    ReplyDelete
  11. Anonymous9:13 PM

    Post a Comment On: Sixth Pay Commission for Babus' "We must scrap Pay Commissions"
    10 Comments - Show Original Post
    Collapse comments


    Anonymous said...
    The ‘wellknown economist’ has presented a biased view, not based on ground realities, and states half truths as facts.
    Did the government hastily set up the Sixth Pay Commission? In fact the setting up of the commission is much belated. The Fifth Commission itself had stated that the Sixth Central Pay Commission be appointed by the year 2003 so that new pay scales for the Central Government employees could be made effective from 1.1.2006. The NDA government did not act in time and the present government had set up the Commission during the second half of 2006, when actually the report should have implemented by 1.1.2006. Still the article above says the government hastily set up the Sixth Pay Commission……!
    Wasn’t there reduction in the workforce in central government?. Even a common man knows that there had been considerable decrease in the recruitment to government sector, and for the last several years, one third of the vaccancies are only being filled up. About which 4.2 million central government employees, the “economist” is talking? In fact there are now only 3.2 million of them. You can wake up a person who is sleeping, but what about a person who pretends as sleeping?
    The funniest part of it all is the economist’s concern about the poor….! “The poor pay through higher taxes for a salary budget that could have been spent on physical and social infrastructure”, says he. Why the great man does not worry about the high salaries in the private sector, which eventually will pass to the common man if not in the form of taxes, as increased rate in the price of products and services, as the end use customer? “This hike is paid for by the 380 million who work outside the government” says the ‘economist’. The first thing to be noted in this regard is that though the number of government employees sounds as very large, while considering the population of the country it is not up to the mark of developed countries. India has a population of more than 130 crore. What does the ‘economist’ say about the population - bureaucracy ratio? Is it not the government machinery that had facilitated for the development process of the nation, and economic progress? Who except the public exchequer has to pay the public servant? One more point Mr. Economist, the government employees also pay tax, and they are the only category of people who pay correct tax.
    What about the hike in the prices and cost of living? Is the government employee to live a beggers life?
    Who’s interest in fact these ‘Economists’ are trying to protect, pretending as the protectors of the nation and the general public?. In fact they are just trying to protect the interests of the capitalists inside and outside the country. They are not worried about the finance of the country. The same economists will protest if the government imposes restriction on fringe benefits on high rate private sector salaries, by which the private sector usually avoid tax. They favour tax relaxation by way of SEZ s. How does these all help the above mentioned poor?
    Infact these agents of the capitalists do not want the talent to go to government sector. They want the government to be manned by unfit and unsatisfied employees. They want the pay in government sector to remain a pittence, which will compell the employees to become corrupt . Then only they will be able to manipulate the system as they wish and to protect their interests.

    11:40 AM


    Anonymous said...
    I toatally agree with the author of the comments (annonymous)on this interview. Those who advocate against pay hike for Government officers, want to make sure that the best talent should be available outside, for them, and for the outsourcing US companies at cheaper rates. They also want the government employees to be corrupt.

    12:57 PM


    Anonymous said...
    Yet another great person has written elsewhere that with the money spent to pay salaries to the government employees, 47 IIMs can be established!. I have not heared anything as foolish as that in the recent years. Are the IIMs solutions for all the problem the country faces? There is no need for any governance in the country - all that it needs is only some factories to produce good managers for the private sector? No post office, health centre needed in the remote villages? No police stations? And will the IIM graduates go and guard the boarder in Kashmir....?
    The problem is with the media, who give undue importance to all this foolish utterance by the so called 'Economists'.
    Many of them have become economists after their failure in the Civil Service Examinations.

    6:45 PM


    Anonymous said...
    Ignor this Bibek Debroy yaar....

    6:57 PM


    Anonymous said...
    The views of Bibek Roy and people of such mean mentality is highly biased and pro private sector. He has ignored the pay packets the private sector is offering its employees and the economic boom the country is witnessing today. Does he think the public service has no participation in the country's development? In fact each and every citizen contributes towards nation building in one way or the other. When the Government has taken the necessary steps to give her employees the due they deserve, what ails the people like Roy to stifle the initiative of the Government?

    3:04 PM


    Anonymous said...
    Definitely, we must scrap pay commissions. But, be sure that if Government can’t pay reasonably and do justice and welfare for it’s employees, there is serious doubt that it would be able to do justice and welfare of rest of the citizens.

    12:58 PM


    KHAJA SYED said...
    Mr Economist, You are Great Saviour of the Poor.I entered service in 1989 with M.E Degree in Central Govt Service for a Gross Salary of Rs3210/(Dec,1989).My classmate joined private concern for Rs3000/ gross per month at the same time.Today after 17 years of service my Gross is Rs25000/ per month, my Classmate entered private concern is drawing
    Rs 2Lac per month.How do you compare this case.Will you agree that Govt should put a freeze on salary hike to Private sector also.Same Qualification in Govt/Private should have same salary, Private should be restricted to pay at the same level Govt pays.Will you agree for this.

    12:08 PM


    Anonymous said...
    Yes i agree with Mr. Khaja Syed. In addition to his comments, I would like add. I would rather say that Government must pay better than private sector. In the name of economy such economists are loosing thousands and thousands of crores of Government (public) money by giving unnecessary over-incentives to private companies (SEZs etc.) and mindlessly putting at disadvantage the meagre number of government employees by cutting them in number and pay. I would rather say that Indian economy is running on Government employees and they should must be paid over and above the private sectors.

    5:04 PM


    KHAJA SYED said...
    For example,Tata motors will just pay a lease rental of just Rs 20/-crores over 60 years period for about 600 Acres of land at Singur(West Bengal)and in addition has also be given Tax subsidy of Rs100/crores.Can you expect any where in world such a concession will be given to private sector other than in India.Poor farmers land is acquired after killing them(see Nandigram,West Bengal).Private Sectors have not paid more than Rs 50000 crores loan taken from Banks in the last 50 years and have not paid tax liability of more than Rs 85000/-Crores during the last two decades to Income tax department have no moral right to talk against appointment of sixth pay commission

    7:17 PM


    Anonymous said...
    Instead of going for useless committee fixing the pay scale for the last several decades, some new strategies to be followed to cope with scientific advancements. Political people are doing gimmick always in this form of new pay for their continued existence. They must control inflation rate to a good level not affecting a single poor person for his daily survival.

    Pay for work should be implemented in all public sector and educational institutions also. How many teachers have got valid or good degree/qualification? Do they really work equivalently for their salary? How many institute outputs (ie; degree holders really brilliant) possess stuff? Today everything go(es) behind money. In view of this, today no distinction between good and bad can be made. Therefore in my view all being paid enough and there is no need to have 6th pay implementation and rewards should be implemented like Pay for work.

    10:48 PM

    ReplyDelete
  12. Anonymous5:49 PM

    As an MBA son of an IAS officer I say there should be private pubic parity.

    Let's face it till about 1990 Stephens/Xaviers -IAS was vastly more desirable than IIT-IIM.

    Most of these commentators didn't get in the services and basically saw the class A officers walk away with everything car/House/Foreign postings etc because they were the best.Now they keep on talking about how corrupt the govt is.Well who gives the money to the 'corrupt'?

    Every Asian economy has a very highly paid bueraucracy that built it.Japan has MITI ( Compulsory study in most MBA courses),So does South Korea,Taiwan,Singapore etc.

    Basically what is required is parity with the private sector the highly educated IAS/IFS and other Class A officers deserve salaries at least 4 times what they are currently earning.The others i.e the clerks,peons etc which make up 95% of the staff are earning 3 times their private sector counterparts.You retrench them and you save enough to pay the senior grades 10 times the salary and still save money!!

    Long live the IAS the steel frame of the country!

    ReplyDelete
  13. Anonymous9:27 PM

    if we claim that we are emerging economy in world and are ranked fourth then is it not logically to pay at least 40th heighest pay to its employees, i spomehow doubt the basic economic understandig of the writer.

    ReplyDelete
  14. Anonymous7:26 AM

    The pay commission is neither a plitical agenda nor a derailment of economy. Mr. MBA and Mr. Economist should try to understand that in the era of globalisation we can not keep our labour market cheap,unskilled and in competent. Our economy is growing and thats why the wage has to be increased. To make india more competent we have to improve the manpower skill and make country corruption free. And salary increase is on of the measures. High salary is directly reltated with the standard of living and the quality of work. Just wait and watch how india is going to become like europe.

    But one message for farmers, please don't sale your lands, unless it is infertile. Because the future is of farmers.

    ReplyDelete
  15. Anonymous12:09 AM

    pay shoud be increased. few years back the govt emplyee is proud to say as iam a govt employee. now the govt employee is feeling shame to say that working in govt becz the govt employ cant effort to go to cinema with all their familiy members which cost more than 500 rupees per movie in metro towns. with all these frustations the working culture will come down

    ReplyDelete
  16. Anonymous11:58 AM

    what types of person this is?Whether he is a economist or something else?can you give me a answer why price hikes and cost of living is increasing?

    ReplyDelete
  17. Anonymous5:32 PM

    We all know very well how an economist's mind works. A bit of half truths here and bit of half truths there add a dash of jargon and you have perfect recipe to confuse the government and the general public.

    Mr. Economist says that SPC will increase inflation and stifle growth. Well as we all know that the private sector is raking in the money, and how is that their spending has not increased inflation and stifled growth?

    Well Mr. Economist forgot to mention or let us say economized on truth about the following fact... Inflation no way gets affected if you spend an extra rupee at the retailer level. Inflation is calculated based on Wholesale Price Index (WPI), Commodity Price Index (CPI, etc and not on retail prices. In turn WPI, CPI is affected by agro-climatic factors, industrial growth etc.

    Funnily enough as based on the advice of the economists, the government wants us to spend more by reducing savings, so that it boosts economic growth.

    Hence a reasonable hike in salary for government servants would not increase inflation but should fuel more growth in the economy.

    Further our esteemed Mr. Economist has suggested of collective bargaining power, Is Mr. Economist encouraging trade unionism of the government machinery? Imagine the government machinery paralyzed as a result of flash strike in order to increase pay hike??? The number of man days being lost? What happens to your growth than Mr. Economist??? You will be the first ones to shout out from the roof tops regarding this.

    I am taking your opinion with a pinch of salt Mr. Economist

    Salt anyone?

    ReplyDelete
  18. There are two faces to each coin. The people opposing SPC are looking at one face only. Have they compared the salary of the people working in private sector with the people working in government sector? Now a days it has become a fashion to blame government and government employees. Does these opposers have seen the huge amount of work done by govt. employees? Population is growing, scope of government is growing with changing senario of developing India. And natuarly work load on govt. employees is also rising. And what about work force in govt.? To face this rising workload???? It is reducing and whole raised workload being faced by the small serving govt. employees.

    When there is any natural or manmade calamity, or any sort of emergency govt. staff is working round the clock...(They has to..) At that time what these opposers ot SPC ( who are mainly highly placed corporates, so called economists) are doing; OR what highly paid private sector employees are doing?
    And now a days such situations are common because of any sort of emergencies, reduced workforce and raised workload.

    Isn't govt. need more workforce to face raised workload for good governance?

    Does only pays of govt. servent contribute to Inflation; not of those private employees?

    Get the example fo District Magistrate - has to look after all maters of a district - may be it of Law and Order, may be it is drout, flood and has much more responsibility and tension than any other managerial post of any firm. What salary he gets in comparision to the private manager?

    Can these opposers of SPC think of rationalising and bringing private sector payments in line with govt. sector payment rather than opposing SPC? This may bring social balance...!!!
    Can they DARE to think like this?

    If there is problem - solve it by cutting its roots not by cutting branches.

    Reducing workforce in govt. will not solve problem but will lead in increase of problems. Because with reduced workforce than required will govt. be able to deliver its duties for good governance...???

    Think ...

    ReplyDelete
  19. Anonymous5:46 PM

    Tommorow this So called economist will say " scrap pay for government employees" becoz they are a burden.

    This is just bashing to get a headline for himself.

    ReplyDelete
  20. Anonymous2:42 PM

    Shit man..i dontt even want to comment on this Bibek Debroy charactor. A nonsence of a man paid and supported by the private sector to divert fine men and men from the public and Defence services to there own offices to make profit. Havent seen a more sicker individual. A Devils Advocate for sure. Take a hike dude

    ReplyDelete
  21. Anonymous11:18 AM

    MUST READ THIS
    Sir....
    As told by Bibek Debroy, secretary general, PHDCCI on July 24 2006, regarding the Pay commission is absolutely personal.
    1.If u think in a broad way, and in reality the central government employee specially Defence Jawans(Sailors/Airmen/Jawan) in three Armed forces are getting the Payment just HAND TO MOUTH.
    2. One cannot just think of his children higher studies and even hiring a home with the given salary.
    3. As per Mr Debroy, Other govt. employees can go for a Wages Bargain where as in Defence it is strictly prohibited. It it all it is done by any one, it would be considered as MUTINY
    4. Now my question is, even if the Govt scraps the Pay Commissions, then where will we stand in next five years.
    5. So before commenting on such things, one should reemphasize on the impact of its because it affects milions of those people who are DYING FOR THE NATION
    6. Sitting in higher post , this type of comment is not a healthy mind's sign of MR Debroy.
    7. As far as GDP is concerned,by a mere hike in payment, i dont think, this will be a burden on India's Growth.

    Thank you

    ReplyDelete
  22. Anonymous11:23 AM

    JUst keep aside this MR Debroy as because he has gove insane and he himseld doesnot know what he wants to say.
    May I ask him, What is your annual income Sire!!!
    As of now, he is happy with his highend salary, so he has got all this type of erring notations just to be fame(in a wrong way)

    ReplyDelete
  23. Dr. Debroy's fan, sorry, AC.8:21 PM

    Mr. Debroy,

    What do you suggest ... should the government employees all leave their jobs and join the private sector or setup their own ventures !!!

    In such a case, who will maintain the government machinery !!! Don't you think that in such a case there will be no governance and the country will replicate the likes of Bangladesh, Nepal and Zimbabwe.

    If such a situation arises, there won't be any need for economists in the country at all. No economy, no economists.

    TATA. BYEBYE to you.

    ReplyDelete
  24. I also agree with the comments made by anonymous to Mr. Economist. Atomic reasearch institutions , ISRO and a host of other institutions are there in India who are really doing their work in a pretty beautiful manner. This Economist is winking at all thos things by telling fabricated arguments. And another thing these 43 IIM story, if all ration shop or toddy shops are tunred into IIM , can we produce better manpower pool??!! Nope.Talent is rare. IIM products are better since seats are lesser. If all the management institutes are groomed like IIM , there will be only half baked products as it is available from any other ordinary colleges.Every body cannot get into IIM. Don't be silly...

    ReplyDelete
  25. Anonymous6:42 AM

    yes i do agree with our economist in regard to utilization of the salry paid to the central government employees in terms of productive output, but it is never possible in goverment structure because in this structure no reward for the good performance and no punsihment for the poor performance ,why is it so because
    (1) at the time of entry in the goverment job ,criteria for the selection of staff is highly discriminating and they are like influence,reservation etc

    (2) even after entry criteria for promotion is also govern by seniority ,influence etc

    (3) lastely security level of the job is very high

    so due to above mentioned reason collective productive output from the goverment organisation is very very low.

    yes but for the employee fulfilling the above mentioned selection and promotional criteria it is very very high ,how ......
    with the minimum responsible input the output (salery) is very high

    so here no risk ,no responsibility,
    highest level of security and always comparision with the employee who always take risk ,responsibilies in privet sector is funny matter but for efficient person its batter to not to discuss such thing simply to join some good privet firm where productivity of employee and employer is proportionate

    ReplyDelete
  26. Anonymous12:12 PM

    Executive is an important constituent of the State. An improvished and underpaid executive would always remain susceptible to corrupting influences of greedy private enterprise. Since, a Govt employee sits in the position of encompassing and scrutinizing important issues relating to public policy, the pecuniary necessities of this class has to be looked into especially in the changing times of consumerism. Therefore setting up of such pay commissions are essential. It would also not be out of place to say that the talk of collective bargaining in administration would only make the entire nation what West Bengal is today.

    ReplyDelete
  27. Anonymous1:11 PM

    OK. LETUS AGREE WITH OUR LEARNED FRIEND. I HAVE FEW QUESTIONS TO HIM
    1. WHAT WAS HIS EMOLUMENTS IN 1996 AND NOW?
    2. FOR AN EQUALLY QUALIFIED PERSON IN GOVT. SECTOR. WHAT IS THE DIFFERENCE (I.E. RAISE IN THESE YEARS)

    ECONOMY AND COST OF LIVING INFLATION (ALL RELATED ECONOMIC WORDS) ARE SAMEFOR BOTH.

    lET US REDUCE mR. ECONOMIST'S EMOULMENTS TO THAT OF HIS GOVT. COLLEGUE UNDER DISCUSSION.
    WITH HIS INNOVATIVE IDES, HE BEING A NOBEL MAN, SHALL ACCEPT TO THIS ARGUMENT AND LIVE WITH THAT.
    I HOPE IT IOS CCEPTABLE TO HIM.

    ReplyDelete
  28. Anonymous1:17 AM

    people must note that sixth pay commission is not created to increase the pay only. it is also examining how to improve the functioning of the government and how best WORK can be extracted from the employees.

    reducing staff strength or less wages to employees is not going to boost the indian economy, there are some many factors to achieve growth.

    General public must know:
    1. contributary pension scheme w.e.f 1.1.2004
    2. works of safaiwala/peon are performed by man power agencies.(contract basis)
    3. adopting hiring methods
    (i)car
    (ii)photo copier
    this reduces the cost of machine and maintanence.

    4. If no recruitment, what is the meaning? work is loaded to another personnel.They also doing in addition to their regular duties.

    5.delay in payments in the name of arrears.

    i mentioned very few points here. it may vary dept. to dept.

    So, don't think that the government of india is focusing on wages only. It is also coming up with more expenditure curtailing methods.

    departments need more personnel , where is the point of reducing?

    1. Tax
    2. police
    3. Anti corruption
    4. Justice



    When population is increasing, allow this departments to spread their wings to fulfil the duties.certain things cannot be done by computers.

    The economist(s) are requested to help the government if possible not other ways.

    India still need more personnel to handle public money and monitoring departments.

    "when i was working in madurai, there is a hotel which increases the rate of meals by rs.1 or 2 whenever GOI announces Dearness allowance." this is not a joke. just think what will happen if pay commission announces the pay structure.

    ReplyDelete
  29. Anonymous8:06 PM

    Although a distant dream, instead of having a fixed Pay Commission, the govt. should introduce performance based appraisals (if probably a variable share rolled out annually as bonus). No one can deny the fact that there are shameless bloodsucking work-shy govt. employees who are earning for nothing.

    ReplyDelete
  30. Anonymous12:23 AM

    I have few questions about payment to government servants and subsequent increments including pay commissions. What is in it for the end customer : the citizen of this country, who pays for these pay hikes and is sick of the government servants?
    (a) What is the out put of a government servant compared to a similarly paid person in private sector?
    (b) Why do we need so many government servants?
    (c) What value does a government servant provides to his/her customer : the ordinary citizen on the street? Ask the customer and not the government servant.
    (d) Will VI pay commission implementation improve the quality of services and governance provided by government servants?
    (i) What is the present quality as perceived by a citizen?
    (ii) What is the targeted quality? What is the time frame and what are the trends to be observed?
    (iii) If the quality is not achieved with in the time frame, will the pays be rolled back and recoveries made from the pays of the government servants?
    (iv) Will the present government and ministers be punished for the fall, if the quality improvement fails?

    ReplyDelete
  31. Anonymous1:12 PM

    There are very educated and talented govt. servants who have been selected through tough examinations and are getting pittance when related to thier qualifications who should be rewarded.
    There should be a hevier punishment for corruption and inefficiency
    Promotions should not be based on seniority and reservation but on merit
    The economist talks of the poor - even the class III & IV of the government staff fall under the urban poor category and this pay commission is to alleviate them.

    ReplyDelete
  32. Anonymous12:42 PM

    Government job is to provide law & order, facilitate economic growth & administer. They deserve money which they get in the form of taxes.

    This pay revision would have been better had it been limited to onl ythose employees where econmic growth is seen. Why would babus of Bihar/Jharkhand/WB/ and other backward places deserve a revision ?

    Moreover what is government ? For us it - by the people, for the people, through the people. Pathetic this country's people are the worst sufferers. Common man feels harassed and cheated by these agents.

    ReplyDelete
  33. My First question is, Why do you work in Government Org instead of Private Org for 17 yrs, if you know there is high salary in private concern? You want your job security, but for your friend he is having more risks in daily life. If his company thinks, he doesn't perform well then there will be a layoff. But what about you for the same context? How much of complex job you do? There is high job security but this is not the case for private org

    ReplyDelete
  34. whatever the author has written that something which is like an illiterate person walking on the street can voice his views.first of all i would like to ask a question if please he can reply.what does he think about the government staff,does he think that the people who are working in government sector are less qualified than their counterparts in corporate world.first of all if you want to have quality people in government sector you have to pay them also.and even at this time wages in government sector are sufficient to give a good life style or status.so
    if he thinks that government can be run by people of lower merit then ok.then why do they complain about corruption and those things.and as far as economy of the country is concerned if it is not affected by other plans of government it will be only affected by sixth pay commission how does he think so.if you are paying less you should be ready to take second grade of people in government services and they should not complain about bad governance.and if u want a good government u have to recruit quality people and pay them accordingly.ya if they want to reduce the recruitments they can.but this is nowhere a logic that sixth pay commission will affect the economy so it should not be implemented.are those people who
    work in government people are less qualified.i think no the recruitment procedures at any level in government are very tough in comparison to corporate sector.does he thing those secretaries sitting there in secretariats,what is the quality of work they are doing,i think that is more worthy job than a CEO,in terms of impact on the society.Does he think laloo prasad
    has changed railway ministry into profit making organization,no those are the policy makers sitting over there.laloo has done one thing only,he has given them freedom to work.and if people complain about
    bad bureaucracy, that is not due to
    people this due to many other social and political factors.i agree that there should be performance pressures and realistic deadlines but it doesn't mean that govt employees should not get pay hikes.and why so much buzz about
    one hike in ten years,do they think
    that even in class one posts annual increment along with DA nearly equals to 1500Rs. can even cope up with any kind of inflation.Does he wish that govt employees have no right to live a good life or he want that govt officials should be on the streets to earn their livelihood. i think either those kind of people should not comment about governance whether good or bad, or they have to say that those people deserve good life.this is all i want to say.the author of this article please read it with the point of view of a govt official who is well qualified and has the ability to do well even in corporate sector.if he is not able to do so he has to agree that he want only mentally handicapped people in govt sector who are not competent.if he agrees he can even agree to work them as contract labor.now it is up to him what kind of quality he wants.because i think everyone has a right to earn according to his ability.thats it if author has some conscience he should comment on this.

    ReplyDelete
  35. Anonymous11:06 AM

    With due respect to his view Mr. Economist must be sent to a snowclad galcier at the height of 20 thousand feet, or lets say sitting in a rain forest with scorpio's and snakes w/o even getting to go for natures call or even.
    Judge when you face or can withstand something like this.

    ReplyDelete
  36. The same question again. You know there is a job security at the time of joining, right? If you are really in army services there's a sense of giving money to protect our nation.

    ReplyDelete
  37. Anonymous7:14 PM

    All in all ..As far as the debate is concerned I feel that its not a public Vs Private sector debate. That debate was over in 1950. With all due respect to the "leftists" and "capitalists" .... The moot point is that who decides the worth of Govt Employees?

    Think over this.

    A traffic policeman stands 8 hrs in sun and dust and gets 6K in hand. Will you blame him for taking a bribe?
    A police constable does thankless jobs which involve tough routine. He gets 5K in hand. Do u blame him for taking a bribe?
    A "babu" in govt office has to resort to bribe because his pay os paltry. Do u blame him?

    Its nice to say that one should be upright and honest and such idealistic stuff ..esp when u are financially sound.
    Try and think that it does not work in reality.
    A pvt sector guy doesnt take bribe because he is paid well and not because of higher ideals.
    Think about it...the govt sector does a lot of jobs ..u wont find takers for in Pvt Sectors..
    Try giving a share holding Option in lieu for dying on the border ..and this "economist" will come to know ahy pay increase is a must

    ReplyDelete
  38. Anonymous12:22 PM

    ha ha wonderful scholarly article. we however know who is writing the article and can chose to ignore it.

    ReplyDelete
  39. Anonymous9:15 AM

    I dont know who is that Economist ,but I feel he dont know even A,B,C of economy.
    4 million Govt Employees are getting somewhat okay salary after 6PC . Why he is so jealous. Are his private sector people will go & fight at border. Are those people ready to serve the govt at the present salaries

    ReplyDelete
  40. Anonymous5:36 PM

    My views as a past Government Employee (DRDO)now living in US is somewhat different.
    I worked for the govt for 6 years before leaving the job for a private sector job in 1995. What I had seen was irrespective of the talent a person had everyone got the same raise. My collegue next to me was sleeping during the lunch time for several hours and the ladys spending good amout of time chatting while few of us were trying to solve the technical issues and programming. I also would stay several hours late at work to solve the issues. As these few were taking interest all the important issues were dumped on us and of course this kept us motivated.

    After few years I realized that I could not afford to pay the rent for better house to live in if think ofgetting married and raising the family.

    The pay commission came and wen then raising everyones salary to the same level. I beleive certain reservation categories got better benefits.

    OK. I saw that pay hike has nothing to do with the talent or performance. I quit the job for private sector which paid based on my skills 4 times more than the Govt pay. Later I moived to US and now purely surviving on my skills.
    One of My friend who was a gold maelist could not think of venturing out of the "safe govt job" stil is stuck there making far lesser than his private sector counter parts.

    So there are two sects of people I guess would be happy with the pay commision.
    1.Lazy people who just want job security.
    2.People with no talent and do not have guts to venture out.

    I guess theere should be some balance between the private and public sector payscale, but there should be a huge mark up of hike based on individual talent. Organizations should function as autonomous responsible for their growth.

    Why should a Govt employee get a raise at the cost,risk and talent of a private sector employee?

    ReplyDelete
  41. Myth 1: Private sector is more efficient than Government sector. Counterpoint: Private sector is driven by profit. Efficiency is defined as ratio of output to input. Please get your yard-stick right.
    Myth 2: Government sector does not nurture talent. Counterpoint: Actual experience shows - even private sector has crushed talent. Earning well in USA is because the dollar is 40 times more worthy. Please dont compare Indian government sector with USA. A Quote says "In any organization, every person will rise to his level of mediocrity." This quote was from a western author, not Indian.
    Myth 3: Government sector is corrupt. Counterpoint: Yes, agreed; but not as much as private sector. If corruption means asking for money then private sector is driven purely by money paid up front. The government sector caters to the whole population, which includes huge masses of poor and ignorant.
    Fact 1: The pay hike is given to government employees and not to Government. I work in an elite govt. body. I am as good as you, if not better. You left for USA, but I stayed back. Do you want me to work dilligently and also get paid poorly? I already put my son through top education and sent him abroad for higher studies. I hope he will come back and work for India in the near future. What do you have to say to that?
    Fact 2: Like godmen, economists can talk through their hats.

    ReplyDelete
  42. Anonymous3:29 PM

    Mr. Khaja Syed you compared you salary with u friend in Priavate sector. did you ever compare your achivements with friends in terms of technology perspective. it's impossible to stay and get goos pay in priavte sector without Hardwork rather than in goverment organization. also check out the perks you are getting life long pension, bunglow ,servants,car for Officers. And if you any private organization, it run based on business- profits, so employee become part of this and he has to work hard to be part of the organization. it just not easy as govermnet service.

    ReplyDelete