Who says there’s no inclusive growth? Inclusive of all benefits, the peak wage of an unskilled labourer doing loading and unloading work for the state-run Food Corporation Of India (FCI) has reached R2,25,000 a month, says the latest Commission for Agricultural Costs and Prices (CACP) report.
Compare this with the basic pay of a Cabinet secretary, the country’s top bureaucrat, which stands at R90,000 a month and R80,000 that the secretaries to the central government get, after the Sixth Pay Commission award. Of course, the babus get sundry perks that take their effective compensation to much higher levels, but the FCI labourer might still give them a competition.
The high wages and other benefits, coupled with an up to 14.5% impost as taxes and other charges on grain procurement not only inflate the Centre’s food subsidy bill by driving up purchase costs but also threaten to make the whole system unsustainable, CACP chairman Ashok Gulati told FE. They also make exports of grain from official reserves difficult without subsidy.
True, an average labourer at the procurement agency costs over Rs 35,000 a month, but the departmental (permanent) labourer, on an average, takes home Rs 75,000 per month, sources say. No wonder the FCI's permanent employee is envied as his remuneration is nearly 11 times of what a contractual worker employed in the agency gets and more than 20 times the minimum wage under the Mahatma Gandhi National Rural Employment Guarantee Scheme.
FCI chairman and managing director Amar Singh wasn't available for comment. An email query sent to him on Wednesday didn't elicit any response until the paper went to press on Thursday.
“...FCI suffers from dis-economics of scale, that is, as its scale of operation increases, the per unit real costs also increase. This suggests FCI is on the high-cost segment of the cost curve. This may be due to higher procurement incidentals and increasing carrying costs of the buffer stock,” CACP, which recommends procurement prices of crops to the government, observed in the report.
Between 2008-09 and 2010-11, procurement costs of paddy went up by around 35%