Fat pay packets still elude PSU execs

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While Central government officials are all set to take home a fatter pay packet, executives in the public sector undertakings (PSUs) would have to wait for some more time.

It is learnt that several PSUs have objected to some of the key proposals put forward by the Second Pay Revision Committee (for PSUs), submitted in May this year. Moreover, key ministries like coal, petroleum and natural gas, among others, are yet to send in their views on a Cabinet note circulated by the department of public enterprises in the ministry of heavy industries and public enterprises.

Prime Minister Manmohan Singh, finance minister P Chidambaram and heavy industries minister Santosh Mohan Deb, are learnt to have strongly backed the recommendations of the Pay revision panel, some of which are unprecedented and could pave the way for far-reaching reforms in PSU governance.

The committee has recommended that the pay scale for PSU employees be independent of Central government salaries. The Cabinet was expected to take up the second pay revision committee’s report some time last month or early September, but PSUs’ objections and ministries’ dilly-dallying on the proposals has delayed the decision.

“Lot of objections have been raised by the stakeholders. Many PSU executives have objected to the fact that different pay packages have been recommended for the same grade of executives working in PSUs involved in the production of the same type of products,” a senior government official told FE .

The PSUs have also objected to the new classification of PSUS in to five categories — A+, A, B, C and D based on the total income, size of manpower and geographical spread of their operations for the purpose of deciding the ‘fixed’ component of the package. “All of them want to be classified as A+ because then they will get more money as the new pay revision is profit-linked,” an official said.

The second pay revision committee, set up under Justice M Jagannadha Rao (retired Judge, Supreme Court), had recommended a considerable hike in the pay package, giving more weight-age to performance related payment ranging from 40-200% and introducing ESOPS.

The move is expected to benefit around 2.5 lakh executives working with the 247 PSUs. The new pay scale would be effective from January 1, 2007. The proposed hike would be not bleed the government exchequer, as the PSUs would be required to foot the bill themselves.