Use it to jettison some government departments

Updated: Jul 31 2006, 05:30am hrs
The first question that arises is why the announcement has been made now, especially when no strident demands are there from the employee unions. Clearly, this has now become a ritual for each decade, whether needed or not, to have a new Pay Commission. Indeed, the Fifth Pay Commission award includes an automatic escalation clause, compensating for inflation, so that the real wages to employees are protected. One can only surmise that the pressure has come more from the political needs of the ruling party than the employees themselves! An 18-month period for the Commission, with a few months for processing the award, will time it extremely well prior to the next general elections, if held on schedule. That is the master-stroke of timing by the ruling party.

The Fifth Pay Commission of Justice Pandian did not seriously address the question of quality vs quantity. There is no doubt that the remuneration to government servants, particularly at the Class I and Class II level, needs drastic upward revision to keep pace with private sector trends. But one cannot have sharply higher wages for all without serious staff reduction there is no way to have the cake and eat it too. Justice Pandians last award included, along with a significant pay rise, some employee obligations like reduction in the number of holidays, diminution in total staff strength over time through attrition, etc. But while the then government generously piled on further benefits than the award entailed, all the employee-obligations were ignored. With improved communication technologies available, along with increasing use of computers, there is a large scope for sharp reduction in total staffing.

Over the years, a lot of excess baggage has accumulated both by the Centre and the states. Many functions which may have been relevant some time in the past but have no validity now continue to be performed by the Centre and the states. Work methods using modern techniques and technologies have not evolved. An archaic file system, created when the telegraph was not even in existence, continues to be the preferred method for processing government work. There is vast scope for rationalisation of functions and jettisoning of whole departments in every state government, as well as at the Centre.

One can postulate that reduction of total staff strength by 50% will at least double efficiency. The Sixth Pay Commission should be used to trigger this process. Many functions can be outsourced for significant efficiency gains, coupled with reduction in wage bills. Serious reduction, particularly in class IV staff, clearly has to be contemplated. However, perhaps all this is a pipedream. The moot question, of course, is whether any state government, or indeed the Centre, has the courage to tackle these issues.

The Government of India, with vast flexibility in resource mobilisation, can conveniently handle any significant increases in the wage bill. But the bulk of the governmental staff is located in state governments; most state governments own revenues are not enough to meet even their staff wage bills. It is frivolous to comment that the Pay Commissions award is binding only on the Centre; the states must decide their wage policy based on means. This is not practical. The pressures and compulsions on states to emulate a central award cannot be resisted. Most states have, even now, not recovered from the trauma and punch delivered by the Fifth Pay Commission. One more will be a further cruel blow to state finances.

But somehow, the Centre and the states will successfully meet the challenge! All this means is an increasing share of government revenues will go to meet the wages of its employees; anti-poverty programmes/public health schemes and the rural development sector will actually bear the burden, as they have done for the past 50-years. After all, if the government is not for the benefit of the politicians and the bureaucrats, what else is it meant for The poor hapless citizen is welcome to stand by and watch.

The writer is a former Union cabinet secretary