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Pay hiked for 360,000 employees of PSUs

Pay scales for more than 360,000 employees of Central government public sector Entreprises or PSEs have been revised by the Union Cabinet today with effect from January 1997, as recommended by the Justice S Mohan Committee.

The Cabinet decision would rationalise the pay scales of PSU officers and would result in the financial implication of around Rs 20.7 billion per year. The additional financial burden would be borne by the PSEs.

Another significant decision was establishment of North Eastern Space Applications Centre or NESAC, a joint initiative of the Department of Space and the North Eastern Council.

The centre would be located at Shillong, Meghalaya and involves an investment of Rs 250 million during the Ninth Plan period.

The government of Meghalaya has agreed to provide land and other logistics support of the centre.

A spokesperson said that the Cabinet considered proposals of Department of Public Enterprises based on the Justice Mohan Committee report and decided to double the basic pay scales of the executives and officers as well as on 100 per cent neutralisation of dearness allowance and enhanced city compensatory allowance.

The house rent allowance of PSUs employees would be at the rates applicable to Central government employees based on reclassified list of cities as notified by the Central government.

The spokesperson said the payment of the revised package would be subject to the capacity of pay of the enterprises and no budgetary support would be made available to the public sector companies. The pay-scales of the PSUs employees were revised in January, 1992 for five years and the revision was due from January, 1997. The government set up a high-level committee in 1996, headed by Justice S Mohan.

The committee submitted its report in October, 1998 and based its recommendations on criteria, which include capacity to pay, relativity between emoluments in PSEs vis-a-vis the government, need for autonomy in determination of compensation and requirement of uniformity of pay-scales across public sector enterprises.

The spokesman said in enterprises where scales of pay are different from the model scales or where rates of increment are different, enterprises may introduce certain intermediary scales with appropriate adjustments while ensuring that the minimum and maximum of individual scales is not altered. The periodicity of adjustment of DAa would be once in three months as at present.

Payment of allowances and perquisites would be allowed upto a maximum of 50 per cent of basic pay. Over and above of this limit, payments in the nature of performance related payments can be made by the public sector enterprises upto a maximum of five of the distributable profits of the enterprise.

In respect of sick enterprises, including those referred to the Board for Industrial and Financial Reconstruction, revision in pay scales would apply after a strategic plan of restructuring for revival has been approved.

Mediclaim cover through insurance companies for their retired employees and new contributory pension scheme may be worked out by the enterprises as an alternative to EPS 1995.

UNI

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