TeaOpposition to the Agneepath scheme is over, and youth have settled to apply under the Temporary Job Scheme for the Armed Forces – probably because they have no choice. In truth, however, it points to a larger trend in government employment and the caste system of permanent, contract and casual workers. The first tier is paid much better than the latter two, and (at most levels) even better than the market. Since water must find its own level, governments and their agencies have increasingly turned to hiring in the cheaper two categories. Those who want to understand what this could mean will benefit from the dark humor of a Hindi film. Ib alay oo! (on Netflix).
Increasing fiscal pressures have manifested themselves in two other ways. One is the tendency to not fill vacancies, (for example) affecting the postal system. Worse still, there is another trend of government employees not getting their salaries at once for months at a time. You can be a school teacher, a sanitation worker, or a social health (ASHA) worker. For a large number of employees in the government system, a month-end pay check is no longer guaranteed.
So the days of government and state-owned enterprises becoming ideal employers are over. A private sector employer can be prosecuted for non-payment of wages. But when court cases are filed by unpaid government servants, senior officials simply argue before frustrated judges that no money has been provided.
For contractual and casual employees, this adds insult to injury as they do not benefit from the decadal pay commission – the minimum wage five years ago was Rs 18,000 per month. This is an amount that, although “minimum”, is not available to most workers in the country. Whereas permanent government employees are guaranteed not only that amount, often with housing attached, but full inflation-indexing and job security, and of course pension and medical benefits for life. Matters were made worse by the one-rank-one pension ruling, which sparked a pension bill in the armed forces. In such a situation, when the defense salary bill was doubled, the pension bill tripled.
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TeaTwo factors have encouraged governments and allied bodies to move away from hiring permanent employees. One is obviously cost, the other is productivity. In the absence of any reward system for a job well done, there is no incentive to do the job. Also, statutory provisions make it difficult to use a stick. Teachers with relatively comfortable salaries have been known to sit at home while sending a surrogate to teach on their behalf in exchange for partial payment from the teacher’s salary. And office workers have been known to enforce informal quotas on how many letters they’ll send in a day.
So, the strength of contract workers has doubled to 2.43 million in four years. And their share in total government employment has increased. In fact, the Agneepath scheme is just an extension of the cost argument for the armed forces—the counterpunch to a one-rank-one pension, if you will, with inter-generational unfairness. Meanwhile, in a fruitless intervention, the Supreme Court had ordered a few years back that there should be no distinction between permanent and contractual categories in salary or benefits. Railways is perhaps the only organization to have a portal to track this issue. For most of the government, a court order makes no sense. Sharp pay differences are the norm.
The unfairness of this caste system is not going to go away, especially since one of the new labor codes encourages contract hiring (though the other promises, less reliable, to give various benefits to unorganized and gig workers). Nor is it possible to tell pay commissions to at least partially match pay levels with the market. One solution could be to do away with the notion of permanent government employment altogether. If nothing else, it could enforce greater accountability. But one gets an idea of how difficult the reform is when some state governments move back from a permanent, defined-contribution pension system to a defined-benefit plan. As Mankur Olsson warned long ago, vested interest groups will have their way.
By special arrangement with Business Standard
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