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Parliament passes an average of 60 Bills a year. Each state legislature also passes a similar volume of legislation addressing an array of complex issues. Bills cover subjects ranging from microfinance, land acquisition, and honour killings to the impact of pesticides on health. Legislative matters have become increasingly more technical and require specialist inputs to be framed as effective public policy. Unlike other large democracies, legislators in India do not have access to institutional research support. Access to formal information channels is normally available only to the Minister drafting the bill or to the select committee if the bill is referred to it. This deprives MLAs from participating in a more informed debate. Towards this end, PRS and the Indian School of Business (ISB) have initiated the first policy workshop of its kind for MLAs in India. There is an emerging breed of proactive MLAs who are willing to seek out information to help them perform their role better. There are over 4000 MLAs in India, and a small group of MLAs in many states are showing this initiative. They use the internet, consult specialists, and use resources like PRS to get updated or further information on issues affecting their state. About the Workshop The India Leadership workshop is for MLAs who want to be more effective legislators and assume positions of greater influence in state and national policymaking. This unique workshop is for rising stars who want to imbibe new approaches to policymaking and build professional networks with MLAs from different states. The programme is led by distinguished faculty from internally reputed institutions including Harvard, IITs and IIMs. The three day workshop for progressive MLAs will be held at the campus of ISB in Hyderabad. Four such sessions will be held during the year, with the maiden edition being launched in January 2011. Over the last five years, PRS has worked with MPs across all political parties to brief them on relevant issues for their work in Parliament. MPs have recommended that MLAs also would benefit from similar research services. Ajit Rangnekar, Dean, Indian School of Business (ISB) says, “The ISB is committed to working with the Industry and the Government to help achieve national goals. We already have had a long track of engaging with public sector enterprises, and more recently with various government departments, in both executive education and research. We are now delighted to partner with the PRS Legislative Research to develop this programme targeted at capacity building among Indian Legislators. We believe that this ongoing interaction between the government and academia will strengthen our collective understanding of national priorities and spur collaboration for greater impact.”
The Union Cabinet approved the implementation of Seventh Pay Commission recommendations yesterday. The Commission was tasked with reviewing and proposing changes to the pay, pension and efficiency of government employees. These recommendations will apply to 33 lakh central government employees, in addition to 14 lakh armed forces personnel and 52 lakh pensioners. This will take effect from January 1, 2016. Pay, Allowances and Pension of central government employees In relation to an employee, the Commission proposed to increase (i) the minimum salary to Rs 18,000 per month, and (ii) the maximum salary to Rs 2,50,000 per month. It also recommended moving away from the existing system of pay bands and grade pay, which is used to determine an employee’s salary. Instead, it proposed a new pay matrix which will take into account the hierarchy of employees, and their pay progression during the course of employment. The Commission also suggested that this matrix should be reviewed periodically, with a frequency of less than 10 years. The Pay Commission also suggested a linkage between performance and remuneration of an employee. For this, it proposed the introduction of performance related pay which will be based on an annual appraisal of the employee. In addition, it recommended that annual increments of an employee should be withheld, if he is unable to meet the benchmark required for regular promotion or career progression. The Commission also sought to abolish or merge some of the allowances that may be given to employees by various government departments. It suggested that, of the 196 allowances that exist, 52 should be abolished and 36 should either be merged under existing heads, or be included under proposed allowances. Some of these allowances involved payment of a meagre amount of close to Rs 100 per month. In addition, the rates of House Rent Allowance (HRA) were revised. The Commission proposed a methodology to increase the HRA rates every time the Dearness Allowance given to employees increased to 50% or 100%. Dearness Allowance is given to employees in lieu of increases in the cost of living, on account of inflation. The Commission had also proposed a new methodology for computing pension for pensioners who retired before January 1, 2016. This is aimed at bringing parity between past and current pensioners. As part of the new methodology, two options for calculation of pension have been prescribed, and the pensioner may opt for either one. Financial Impact on the government The implementation of the Seventh Pay Commission recommendations is expected to cost the government Rs 1,02,100 crore. Of this amount, 72% will be borne by the central government, and 28% by the railways. As a result, the overall expenditure is expected to increase by 23.6%, with a 16% increase in expenses on pay, 63% in allowances and 24% in pension. Addressing the issue of vacancy As of 2014, the central government had a job vacancy of 18.5%.[i] These vacancies may need to be filled or abolished, if required, to reduce redundancy.[ii] It may be noted that the Second Administrative Reforms Commission had observed that reducing the number of government employees is necessary for modern and professional governance. Further, it had expressed concern that the increasing expenditure on salaries of government employees may be at the cost of investment in priority areas such as infrastructure development and poverty alleviation.[iii] Inducting specialised personnel in the government The Second Administrative Reforms Commission had also observed that some senior positions in the central government require specific skill sets (including technical and administrative know-how).[iii] One way of developing these skill-sets is to recruit personnel directly into these departments so that they can over a period of time develop the required skills. For example, personnel from the Central Engineering Service (Roads) may aspire and be qualified to hold senior positions in the Ministry of Road, Transport and Highways or a body like the National Highways Authority of India. However, another view is that special skill-sets may be inducted in the government through lateral entry of experts from outside government. This will allow for widening of the pool of candidates and greater competition for these positions.[iii] The Second Administrative Reforms Commission had also recommended that senior positions in the government should be open to all services. The last Pay Commission’s recommendations, in 2008, led to an increased demand in the automobile, consumer products and real estate related sectors. With the Seventh Pay Commission’s recommendations expected to take effect from January 1, 2016, their impact on the economy and the consumer market will become known in due course of time. [i] Report of the Seventh Central Pay Commission, Ministry of Finance, 2015 http://finmin.nic.in/7cpc/7cpc_report_eng.pdf. [ii] “Union govt has 729,000 vacancies: report”, Live Mint, November 30, 2015, http://www.livemint.com/Home-Page/X6U6xFe5oR2pW4simMmAhK/Union-govt-has-729000-vacancies-report.html. [iii] 10th and 13th Reports of the Second Administrative Reforms Commission, 2008 and 2009.