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Whoever said the govt employees were ill-paid?

Prof R Vaidyanathan | Tuesday, August 26, 2008 Compared with the private sector, they are actually a pampered lot The report of the Sixth Pay Commission has been accepted by the government with some generous addition. Various experts from the academia and media have given their verdict in its favour, saying the government babus are overworked and underpaid and deserve the hike. Some have even made bizarre observations such as a possible reduction in corruption following the hikes. But it is one of the multitudes of myths in our society that the babus are ill-paid. Most of the discussion on the emoluments of the government employees focuses on the senior level positions like that of Secretary etc. But more important is the positions at the lower end of the hierarchy.There was an interesting news item sometime ago about there being over 11,000 applicants for just three posts of peons advertised by the Haryana Electricity Regulatory Commission. This is hardly surprising considering the lower the category of position in government the larger is the number of aspirants. The salary and perks in government are significantly higher than those of the private sector at the lower levels.Reports suggest that post-implementation of the Pay Commission report, the lowest-level worker will get more than Rs 10,000 per month as pay.In the private sector, a peon or similar-category position might fetch around Rs 3,000 or at best Rs 5,000. An important consideration is the hours of work involved. It is suggested that in many a private sector job people are paid Rs 20,000 or even Rs 30,000 at entry, while government babus slog a number of years to reach there. But, such discussions do not take into account the fact that people with coveted private sector jobs, such as a software professional or investment banker, put in more than 70 hours per week. Even executives at lower levels can be seen slogging from 8 am to 8 or 9 pm daily. The situation is far worse in the non-corporate sector, wherein a clerk or accountant has to slog it out for half the government servants pay with double the number of hours and without adequate holidays.Contrast this to a typical state secretariat or central government office. There is hardly 3-4 hours of work and that to for five days of the week. This works out to 25 hours per week at best. How then can we compare the salaries between the government and the private sector? The second issue is that of part-time businesses undertaken by government employees, often during working hours.Many lower level employees have entrepreneurship and are involved in poultry, gas agency, retail stores, barber shops, chits or micro-financing at usurious rates etc. These alternate businesses provide flexi-incomes while the government job offers a fixed income stream. Employees such as corporation sweepers and electricity linemen commonly outsource their jobs to others and carry on other, more paying business. For a private sector employee, this would be unthinkable. The third issue pertains to bribes, which is perhaps the most attractive part of a government job.Raids by the Lokayuktha in Karnataka provide proof of unbelievable levels of corruption, with small-time commercial tax inspectors or police constables often found to possess assets worth crores of rupees, a substantial portion of it in cash. Such corruption hurts the poor much more than the rich. The India Corruption study 2007, brought out by the NGO Transparency International and Centre for Media Studies, found that about one-third of households below poverty line bribed officials to get a service - from police to personnel in the public distribution system. The study found that nearly Rs 900 crore is paid as bribes by the poor.

For example, according to a recent report, in a government hospital in Bangalore, one has to pay Rs 300 for being shown a newborn baby boy and Rs 200 in case of a baby girl by the hospital employees. It is difficult to think such practices will cease with the pay hikes. Hence, if we consider hourly pay, including bribes, government employees are an extremely pampered lot. So much so one could well question the need to pay them a fixed salary at all. Rather, they should be asked to share a portion of their extra income with the government. That would be a trend-setting move. The writer is professor of finance, Indian Institute of Management - Bangalore, and can be reached at vaidya@iimb.ernet.in. Views are personal.