Pay panel: states can follow Centre

The Central government has done well to introduce a performance criterion for award of annual increments to its staff. The Seventh Pay Commission’s report is being implemented from this month with retrospective effect from January and it will result in an additional annual expenditure of over Rs 1 lakh crore to the exchequer. The Commission, while recommending higher pay scales, had also proposed that annual increments should be linked to the performance of employees. The government has accepted the proposal. The benchmark is that employees should get a certificate that their performance is “very good” to be eligible for annual increments. A “good” certificate will no longer be enough. Norms and yardsticks based on efficiency and productivity are needed to improve governance and to promote merit. They should be enforced well to make government servants accountable.

Salaries in government service are now competitive with those in the private sector. Government staff also enjoy many benefits during service and after retirement, like better leave facilities, more holidays and pension, which most private sector employees are not entitled to. Security of service, assured salary increases and promotions are taken for granted if a person enters government service. This has resulted in poor work culture, indifference, arrogance and sometimes the propensity to indulge in misconduct and malpractices without fear of consequences. Linking annual increments to performance may be considered as a first step to improve the standards of work and conduct of government employees. But fair criteria and objective and transparent mechanisms should be evolved to measure the performance of staff. Personal and political factors and even considerations related to caste, region etc, are known to influence the assessment of the work of staff. A sound system of performance evaluation should be in place to avoid misuse of the new rule and to improve work culture.

Employees’ unions have protested against the decision but the government should not yield to their pressure. Ideally, in offices and departments where government staff have to deal with the public, the views of the people about the conduct and efficiency of the officials they have interacted with should also be taken into consideration in assessing the performance of the officials. That will make the officials more vigilant and responsive to the public. State governments should also follow the Centre and introduce the linkage between performance and increments in state services.