Downsizing of Government Workforce - Recommendations of the Fifth Central Pay Commission and Expenditure Reforms Commission

Some of the Fifth Pay Commission's important recommendations included slashing the government workforce by 30 per cent; abolishing 350,000 vacant posts and reducing the number of pay scales from 51 to 34. The Commission also suggested that the grant of salary hikes to employees should be linked to issues of downsizing government staff, efficiency, and administrative reforms.

The then Finance Minister Yashwant Sinha in 1999, set up an Expenditure Reforms Commission to recommend ways to downsize government workforce in a systematic manner. 'The high rate of growth of non-developmental expenditure by government is a growing and critical source of concern. The most effective and lasting solution to this problem is to begin the process of downsizing the government,' Sinha had then noted, while setting up the Expenditure Reforms Commission.

The task before the Expenditure Reforms Commission was to recommend ways to reduce the roughly 4.2-million-strong central government staff, which would have then helped even state governments to downsize its 20 million employees.

So what were the Expenditure Reforms Commission's recommendations?

• A 10 per cent reduction in central government staff as on January 1, 2000 to be carried out by 2004-2005.
• A screening committee consisting of the secretary of the concerned ministry, a representative of the department of personnel and training, and a representative of the department of expenditure should be set up.
• This committee should prepare the annual direct recruitment plans for all cadres, with approval -- in respect of group 'A' posts -- being accorded by a committee consisting of the Cabinet secretary, concerned secretary, secretary (DOP&T) and secretary (expenditure).
• There should be a total ban on creation of new posts for two years.
• Staff declared surplus should be transferred to the Surplus Cell to be redesignated as the 'division of retraining and deployment,' which will pay their salary, retirement benefits, etc. In these centres, where the number of surplus staff is quite small, the present practice of the parent organisations making these payments may be continued.
• Surplus staff should be made eligible for a liberal voluntary retirement scheme (VRS) recommended by the Fifth Pay Commission, with the exception that commutation entitlements will be as at present and the ex gratia amount will be paid in monthly installments covering a five-year period.
• Those who do not opt for VRS and are not redeployed within one year will be discharged from service.

The Expenditure Reforms Commission further said that computerisation, office automation, creation of paperless offices and changes in office systems and file management would considerably reduce the government's staff strength.

Moreover, the Commission also put before the government a 10-year manpower plan. 'If we have to plan for a 30 per cent across-the-board cut, within a time frame of ten years, it would amount to 3 per cent reduction in manpower levels every year. As this is the normal attrition rate due to retirements, deaths, resignations etc, a total freeze on fresh recruitment alone can achieve the 30 per cent reduction within ten years,' the Expenditure Reforms Commission said.

Thus, the core of the Expenditure Reforms Commission recommendations was that there should be a complete freeze on all new recruitments and no vacant posts should be filled up.
Currently, 3.5 lakh (350,000) posts lie vacant in the central government alone.

Do you agree with the downsizing of the government workforce? What do you think, the fit and competent government servants have right to remain in government service and those who are not fit and competent, should take VRS or quit government service or should be sent to Surplus Cell? Give your comments on the link given below or mail post to sarkaribaboo@gmail.com.