The 6th Punjab Pay Commission has recommended a two-fold increase in salaries of all employees over the previous pay panel, with increase in minimum pay from ₹6,950 to ₹18,000 per month, with retrospective effect from January 1, 2016.
The pay panel headed by retired chief secretary Jai Singh Gill, which submitted its report to chief minister Capt Amarinder Singh on Friday, has suggested substantial hikes in salary and other major benefits, and also substantial increase in allowances for government employees. The average increment in salaries and pensions of employees is expected to be in the range of 20%, with salaries in for a 2.59 times increase after merger of dearness allowance (DA) over the 5th pay commission recommendations, according to a spokesperson of the chief minister’s office (CMO).
The commission has also recommended abolition of all types of special pay and any add-ons in the basic pay by any nomenclature, besides rationalisation of the cabinet sub-committee in 2011 when pay scales were revised upwards following protests against the recommendations of the 5th pay panel.
Finance dept to study report within two weeks
The report, which was submitted to Punjab chief minister Capt Amarinder Singh on Friday, has been sent to the finance department for detailed study and directions for placing it before the cabinet this month for further action. A senior official said the commission has tried to align basic pay structures with those in the central government. “There is a substantial increase at the initial level. The new scales will be implemented from July 1 as already announced and payment of arrears will have to be phased out,” he said, pegging the expected overall financial implications, including the arrears for the previous five years, at ₹35,000 crore.
Though finance minister Manpreet Singh Badal after presenting his budget for financial year 2021-22 had stated that he factored in ₹9,000 crore for the pay and pension hike, there are serious questions about the ability to state to raise resources for bearing such a huge financial implication, particularly amid the Covid-19 pandemic. The state, which has struggling to increase its revenue receipts and been reluctant to take measures for additional resource mobilization, does not have the financial wiggle room.
The report has come at a time when the state’s economy is already deeply stressed and the financial situation is precarious with the Covid-19 pandemic hitting the tax and non-tax revenues of the state. The finance department will examine the various implications before submitting the report to the cabinet for further action. The Sixth Punjab Pay Commission, which was constituted by the previous SAD-BJP government on February 3, 2016, and reconstituted by the present administration a year later, took more than five years to submit its recommendations. Gill said the commission has submitted only the part one of its report.
“We will now look at promotion schemes, health insurance and representations received from employees’ unions, various categories of employees and even individuals as per the terms of reference set by the state government,” he said, refusing to discuss the recommendations made in the report.
Sanjha Mulazam Morcha convener Sukhchain Singh Khehra, who has been leading a protest for the past two years against the delay in pay revision, said they would not comment without studying the report.
Fate of 2011 pay revision uncertain
“The official statement talks about rationalisation of 2011 revision in pay scales. If they have based the new scales on those implemented from 2006, then many employees won’t gain much. In case the recommended scales are based on revision done in 2011, there will be complications relating to employees whose salaries were not increased at that time and they would seek parity,” he said.
The CMO spokesperson said that a significant hike has been recommended in the report in pensions and dearness allowance, while fixed medical allowance and death-cum-retirement gratuity are recommended to be doubled under the scheme suggested by the pay panel. While fixed medical allowance has been recommended to be doubled to ₹1,000/- per month for employees as well as pensioners uniformly, the maximum limit of death-cum-retirement gratuity is proposed to be enhanced from ₹10 lakh to ₹20 lakh.
Enhancement in ex-gratia grant rates in the case of death of government employee, as also in case of death in harness directly attributable to the duty performed, is another key recommendation aimed at benefitting government employees. The commission has also suggested doubling of design allowance to engineering staff and kit maintenance allowance to police personnel, with mobile allowance enhancement varying from ₹375 to ₹750.
Burden of ₹3,500 crore per annum
While implementation of the recommendations relating to pay and pension has been recommended from January 1, 2016, those relating to allowances are recommended from the date of notification by the government. The commission’s recommendations is likely to lead to an additional expenditure of ₹3,500 crore per annum with effect from January 1, 2016, said an official spokesperson.
Another recommendation is that the present system of DA on central pattern should continue and dearness allowance be converted into dearness pay each time the index increases by 50%, to be counted for all purposes including retirement benefits. For pensions, the revision suggested by the commission is by the application of a simple factor of 2.59. Further, pension should continue to be paid at the rate of 50% of the last pay drawn, on completion of 25 years of qualifying service, as per the pay panel’s recommendations.
Besides recommending a simple, transparent and easy to implement pay matrix for all Punjab government employees, the commission has suggested that old age allowance for pensioners and family pensioners, at the existing intervals of five years from the age of 65 years onwards, should continue on revised pension. It has also recommended commutation of pension to be restored to 40%.
Though the existing classification of the categories of cities for HRA is proposed to be retained, with rationalisation in house rent allowance (by a factor of 0.8 of the existing rates and calculated as a percentage of basic pay, the commission has also recommended introduction of several new allowance categories, including higher education allowance in the form of lump sum rate for all employees acquiring higher qualification.
Besides Gill, the commission had DS Kalha as member and SS Rajput as member secretary.