7^TH PAY COMMISSION REPORT SUBMITTED TO GOVERNMENT OF INDIA ON 19.11.2015

 

MOST DISAPPOINTING AND RETROGRADE RECOMMENDATIONS

WORST RECOMMENDATIONS EVER MADE BY ANY PREVIOUS PAY COMMISSION

 

ONLY 14.29% INCREASE IN PAY AFTER 10 YEARS

(EQUAL TO TWO DA INSTALLMENTS)!!!

 

50 LAKHS CENTRAL GOVERNMENT EMPLOYEES AND DEFENCE PERSONNEL CHEATED & DECEIVED

 

HOLD PROTEST DEMONSTRATIONS ALL OVER THE COUNTRY

 

NJCA LEADERS MEETING AT DELHI ON 20.11.2015 AT 11 AM, WILL DECIDE THE FUTURE COURSE OF ACTION

IMPORTANT RECOMMENDATIONS

1.    DATD OF EFFECT – 01.01.2016

JCM Staff Side demand – 01.01.2014 - Rejected

2.    MINIMUM PAY – 18000

JCM (SS) demand – 26000 – Rejected

Dr. Aykroyd Formula of 15^th Indian Labour Conference for calculation of Minimum wage distorted by 7^th CPC to deny the eligible minimum pay.

3.    FITMENT FORMULA – 2.57 TIMES

JCM (SS) demand – multiplication factor 3.7 (26000/7000)

4.    FIXATION ON PROMOTION – NO CHANGE – ONLY ONE INCREMENT IN THE OLD SCALE

JCM (SS) demand – Minimum two increments fixation.

5.    ANNUAL INCREMENT – 3% NO CHANGE

JCM (SS) demand – 5%

6.    MODIFIED ASSURED CAREER PROGRESSION – NO CHANGE – 10, 20, 30

Conditions made more stringent. Bench mark “Very Good” required instead of “good”. Examination for MACP proposed. Hierarchial promotion restored.

JCM (SS) demand: Five promotion – 8,7,6,5,4 (30 years)

7.    PAY BAND, GRADE PAY SYSTEM ABOLISHED

New Pension Structure called “Matrix based open ended pay structure” recommended. Total span of the scale 40 years.

JCM (SS) demand: Abolish pay band, Grade Pay system and open ended pay scales should be introduced.

8.    MAXIMUM PAY INCREASE – 14.29%

JCM (SS) demand – Minimum 40% increase for all employees.

9.                COMPARISON BETWEEN MINIMUM AND MAXIMUM PAY – 1:11.4 (18000 : 205400)

Demand of the JCM (SS) – 1:8

10.          NUMBER OF PAY SCALES – NOT REDUCED - NO DELAYERING

JCM(SS) demand – pay scales with grade pay 1900, 2000, 4600, 8700 and the pay scale 75500-80000 to be abolished.

11.          ALLOWANCES – NO IMPROVEMENT

Commission recommended abolition of 52 existing allowances such as Assisting Cashier Allowance, Cash Handling Allowance, Treasury Allowance, Handicapped Allowance, Risk Allowance, Savings Bank Allowance, Special compensatory (Hill Area) Allowance, Cycle Allowance, Family Planning Allowance etc.

12.          HRA REDUCED TO 24%, 16% AND 8% FOR X, Y AND Z CITIES

JCM (SS) demand – Existing HRA of 30% (for X class cities with population 50 lakhs and above), 20% (for Y class cities with population of 5 lakhs to 50 lakhs) and 10% (for Z class cities with less than 5 lakhs population) may be increased to 60%, 40% and 20%.

13.          DRIVERS – HIGHER PAY SCALE REJECTED

14.          DA FORMULA – NO CHANGE

15.          HBA – NO CHANGE – CEILING RAISED TO 25 LAKHS

16.          CASUAL LEAVE – NO INCREASE

17.          CHILD Care Leave

1^st 365 days – Full pay (100%)

Next 365 days – 80% Pay only.

18.          MATERNITY LEAVE – NO CHANGE 

19.          LEAVE ENCASHMENT AT THE TIME OF RETIREMENT – NO INCREASE MAXIMUM 300 DAYS ONLY

20.          MEDICAL

Medical Insurance Scheme for serving and retired employees recommended.

21.          TRANSPORT ALLOWANCE - NO HIKE -  ONLY 125% MERGER

Pay Level	Higher Transport Allowance cities (A, AI)	Other places
9 and above	7200 + DA	3600 + DA
3 to 8	3600 + DA	1800 + DA
1 and 2	1350 + DA	900 + DA

22.          LEAVE TRAVEL CONCESSION (LTC) – NO CHANGE

One time LTC to Foreign Country during the service rejected. Splitting of Home Town LTC for employees Posted in North East, Laddakh, Andaman & Nicobars and Lakshdweep allowed.

23.          ACCOUNTS STAFF BELONGING TO UNORGANIZED ACCOUNTS – PARITY WITH ORGANISED ACCOUNTS REJECTED.

24.          PERIODICAL REVIEW OF WAGES (NOT TEN YEARS) RECOMMENDED. NO PAY COMMISSION REQUIRED

25.         PERFORMANCE RELATED PAY SHOULD BE INTRODUCED IN GOVERNMENT SERVICES AND ALL BONUS PAYMENT SHOULD BE LINKED TO PRODUCTIVITY.

JCM (SS) demand – No Performance related Pay. Productivity Linked Bonus for all.

26.          COMPULSORY RETIREMENT AND EFFICIENCY BAR REINTRODUCED

Failure to get required bench mark for promotion within the first 20 years of service will result in stoppage of increment. Such employees who have out lived their ability, their services need not be continued and the continuance of such persons in the service should be discouraged.

27.          PROMOTEE AND DIRECT RECRUITS – ENTRY LEVEL PAY ANOMALY IS REMOVED

JCM (SS) demand – the differential entry pay between new recruits and promoted employees should be done away with.

28.          CADRE REVIEW TO BE COMPLETED IN A TIME BOUND MANNER.

Commission recommended to hasten the process of cadre review and reduced the time taken in inter-ministerial consultations.

29.          NEW PENSION SCHEME – WILL CONTINUE

30.          CEA & HOSTEL SUBSIDY

Rate

CEA per month             2250 - 25% increase when DA crosses 50%

Hostel subsidy              6750 – 25% increase when DA crosses 50%

31.          GROUP INSURANCE SCHEME

Level                    Monthly Contribution           Insurance Amount

1 to 5                   1500                                       15 Lakhs

6 to 9                   2500                                       25 lakhs

10 and above      5000                                       50 lakhs

  

PENSIONARY BENEFITS

32.          PENSIONERS – PARITY – LONG STANDING DEMAND OF THE PENSIONERS ACCEPTED

Commission recommends a revised Pension Formulation for Civil employees and Defence Personnel who have retired before 01.01.2016. (expected date of implementation of seventh CPC recommendations). This formulation will bring about complete parity of past pensioners with current retirees.

33.          PENSIONERS – MINIMUM PENSION RS. 9000/-

(50% of the minimum pay recommended by the 7^th CPC)

34.          PENSIONERS – GRATUITY CEILING RAISED TO 20 LAKHS

35.        PENSIONERS – FIXED MEDICAL ALLOWANCE (FMA) – NO CHANGE (RS. 500/-)

36.          CGHS FACILITIES TO ALL POSTAL PENSIONERS RECOMMENDED

33 Postal dispensaries should be merged with CGHS

37.          GRAMIN DAK SEVAKS (GDS) OF THE POSTAL DEPARTMENT DEMAND FOR CIVIL SERVANTS STATUS REJECTED

Recommendation: - The committee carefully considered the demand for treating the Gramin Dak Sevaks as civil servants at par with other regular employees for all purposes, and noted the following:

(a)       GDS are Extra-Departmental Agents recruited by Department of Posts to serve in rural areas.

(b)       As per the Recruitment Rules the minimum educational qualification for recruitment to this post is class X.

(c)        GDS are required to be on duty only for 4 to 5 hours a day under the terms and conditions of their service.

(d)       The GDS are remunerated with Time Related continuity Allowance (TRCA) on the pattern of pay scales for regular Government employees plus DA on pro-rata basis.

(e)       A GDS must have other means of income independent of his remuneration as a GDS to sustain himself and his family.

Government of India has so far held that GDS is outside the Civil Service of the Union and shall not claim to be at par with the Central Government Employees. The Supreme Court Judgment also states that GDS are only holder of Civil posts but not civilian employees. The Commission endorses this view and therefore has no recommendation with regard to GDS.

(M. Krishnan)

Secretary General

Confederation

BSNL got Operating Profit Rs 672 crore and Net Loss Rs 8234 crore for the year 2014-15---Net loss should have decreased, but increased due to change in accounting procedure! Is Next Wage Revision from 1.1.2017 Possible?

BSNL got Rs 672 crore operating profit

CMD BSNL Sri Anupam Srivastava has informed that BSNL got an operational profit of Rs 672 crores for the year 2014-15. During the last few years it has been in operational loss also, besides net loss.

What is this operational profit or loss? If the current year’s income on services exceeds current year expenditure, the company will be in operational profit. If the current year income is less than the current year expenditure, the company will be in operational loss. Calculated thus, BSNL got an operating profit of Rs 672 crores. It means BSNL did not take loan to meet its routine expenditure in 2014-15.

Net loss increased from Rs 7019.76 crore in 2013-14 to Rs 8234.90 crore in 2014-15

What is the net loss? If the current year’s expenditure of the Company plus depreciation and amortization costs etc   exceeds the current year’s income, the company will be in net loss.

For the year 2014-15, BSNL’s total income was Rs 28645.20 crores and total expenditure including depreciation and amortization etc was Rs 37292.10 crore. The loss was Rs 8646.90 crore. From this, after deducting the prior period items and deferred tax benefit, the net loss was Rs 8234.09 crore.

 The total income of BSNL in 2013-14 was Rs 27996.35 crores and it increased to Rs 28645.20 crores in 2014-15. In this, the income on services increased from 26153.26 crore in 2013-14 to Rs 27242.23 crore in 2014-15, an increase of Rs 1088.97 crores , i.e 4.16% increase ( It is to be noted that there was some  increase of income on services from Rs 25654.81 crore in 2012-13 to Rs 26153.26 crore in 2013-14also, an increase of Rs 498.45 crore i.e 1.94% increase. But the employee expenses and administrative & operating expenditures increase in 2013-14 compared to 2012-13.)

The expenditure on employees which was Rs 15435.84 crores in 2013-14 was reduced to Rs 14963.50 crores in 2014-15.This is due to retirement of a large number of employees.

The administrative and operating expenditure was reduced from Rs 11009.30 crores in 2013-14 to Rs 10839.59 crores in 2014-15.

The payment towards License and spectrum fee reduced from Rs 2243.30 crores to Rs 2170.32 crores in 2014-15.

Thus there is an increase of Rs 648.85 crores in income and a decrease of Rs 715.03 crores in expenditure as per the above details. The total improvement is Rs 1363.88 crores. Therefore the loss in 2014-15 should reduce to this extent at least, compared to 2013-14. In fact, it is calculated that but for the change in the procedure for calculating depreciation, the net loss to BSNL for the year 2014-15 would have come down to Rs 5370 crore from Rs 7019.76 crore in 2013-14.

Improvements not due to Manmohan Singh or Modi Governments

Thus there is definitely some improvement in the performance of BSNL in 2014-15 compared to 2013-14. The BJP worshipers are campaigning that this improvement is due to Modi Government. c This is a wrong.  The improvement in performance is due to the procurement and installation of 7^th phase GSM equipment increasing mobile capacity and such procurement started since 2012 under UPA Government due to the consistent struggle of BSNL employees Joint Forum. No extra policy measure was taken by Modi Government besides what was achieved by the struggle of the BSNL employees Forum during UPA regime. Modi Government did not settle any of the demands raised by the BSNL employees Forum for reviving BSNL. The decrease in wage expenditure is due to retirements of employees in more number and similarly administrative and operating expenditure decreased to some extent not because of any policy measure of Modi Government. The policy measure taken by Modi Government is to separate the towers of BSNL into a separate Tower Company with a view to privatize it subsequently. It is to be remembered in spite of knowing the fact that the Corporatization would lead to losses, the then BJP Government lead by Vajpayee had formed BSNL. It assured to take necessary measures to avoid loss to BSNL, but immediately broken that assurance by limiting the compensation to BSNL for its losses on rural landlines only for a few years. Thus the root cause for the losses to BSNL was this policy decision of Vajpayee Government. Subsequently the UPA Government added its share in increasing the losses by delaying the procurement of GSM equipment etc. The spectrum policies of Vajpayee and Manmohan Singh Governments with further continuation of the same by Modi Government are another main reason for the losses to BSNL.

Whether BSNL will become a sick company?

The accumulated loss of BSNL as on 31.3.2015  was Rs 11030.99 crore, after deducting the total of net  losses from 2009-10  to 2014-15  from the total of net profits the company got up to 2008-09.  As per the BRPSE rulings, a PSU becomes sick if its accumulated loss equals or exceeds 50% of the average net worth of the previous 4 years. The average net worth of BSNL for the previous 4 years (2010-11 to 2013-14) was Rs 67926.28 crores. 50% of it is Rs 33963 crores. Since the accumulated loss so far is Rs 11030.99 crores, the possibility of BSNL becoming sick by 2017 is not there.

Is wage revision due from 1.1.2017 possible?

Since there is no possibility of BSNL becoming sick, there is no possibility for denying wage revision on that  basis.

But as per the DPE guidelines issued in November 2006 for the wage revision that took place with effect from 1.1.2007, “ CPSEs which incurred net loss during any of the three financial years preceding the proposed wage negotiation, but not referred to BIFR/BRPSE may also be allowed to enter into wage negotiation, provided they give an estimate to their administrative Ministry/Department as to how resources would be generated by them to meet the extra expenditure arising out of implementation of wage revision.”

If the same guideline is repeated by Modi Government for the wage negotiation due with effect from 1.1.2017, it will create problem. It means, for wage revision,   BSNL should not post losses during 2013-14, 2014-15 and 2015-16. But BSNL was already in losses during 2013-14 and 2014-15. It is likely to be in losses during 2015-16 also, since CMD told that BSNL would become profitable in 2017-18 only.  In such case, wage revision from 1.1.2017 is possible if BSNL management convinces DoT that the extra expenditure required for wage revision can be generated internally by BSNL. The case for this is that for the year 2014-15, BSNL got Rs 672 crore operating profit and it will go on increasing during 2015-16 and onward. But this is as per the existing guidelines. 

The Government has to issue fresh guidelines for the wage revision from 1.1.2017. Therefore we should first demand that Government should allow wage revision in loss making PSUs also since employees are not responsible for the losses. Also, the Government should compensate BSNL fully for the losses incurred by BSNL on landlines and settle the demands raised by Forum of BSNL Unions for revival of BSNL.

Modi Government to speed up privatisation of PSUs

Modi Government to speed up privatization of PSUs

Modi Government is going ahead with some more “reforms”, in addition to the already announced FDI regulations easing. It wants to create a mechanism for selling loss making and non-strategic PSUs. The thinking is to divide loss making PSUs into three categories—(a) Companies that can be revived with financial and managerial help (b) Companies that can be revived by taking a private sector partner, and (c) Companies to be closed down along with selling of their assets. 

It is also considering to privatize select profit making PSUs. Privatization of IDBI Bank was already hinted by the Finance Minister Jaitley.Government is planning to reduce its stake in IDBI to 49%, thus privatizing it. It is likely to take up the sale of State owned hotels aggressively.

Proposal for strategic sale of PSUs is under consideration. Strategic sale means handing over the management of the PSU to the strategic private partner who buys minority/majority stake in the PSU. 

The Vajpayee Government resorted to a large scale strategic sale of PSUs and sold VSNL, BALCO etc in that manner. Due to the pressure from the Left parties, the UPA-1 Government stopped this strategic sale of PSUs. Now Modi Government is going to implement this strategic sale route for privatizing PSUs.

Economy not out of danger and inflation is rising

Industrial growth is weak. There is 4.6 per cent contraction in consumer non-durables(goods used for daily consumption or frequent consumption and not expected to have a useful life of more than 3 years) in September 2015. It high lights the rural stress. 

On the other hand, the urban dependent consumer  durable (washing machines, refrigerators etc lasting for more than 3 years) posted a growth of 8.4 per cent in September 2015. 

The total industrial output in September 2015 grew by 3.6 per cent only while it was 6.3 per cent in August 2015.  It is the lowest in the 4 months.

During April-September 2015, in the first half of the financial year, the industrial production grew by 4 per cent compared to 2.9 per cent last year. But whether this will continue now that the festival season is over? 

The demand in rural areas and also the demand for our goods in other countries are weak. 

Due to the higher prices of pulses and vegetables, the consumer prices are increasing. Retail food inflation was 5.25 per cent in October while it was 3.88 per cent in September. The over all retail inflation was 5% in October 2015.

What an Indian Muslim wants?

"Communal harmony, a check on prices and, development--what every other Bihari wants: we have no special demands". ( The Hindu, 13.11.2015). Abdul Rehman, a social worker, said this on the expectations from the new government to be formed soon by Nitish Kumar.

People, irrespective of their religion, wanted communal harmony and equitable development. They do not want communal clashes provoked by Hindu  and Muslim fundamentalists. BJP and RSS who are ruling the country should learn the lesson and stop provoking hatred against religious minorities and work for development with social justice. They should stop surrendering to international finance capital while posing as super patriots. 

But can they change their DNA?