The Hindu Business Line : Central PSU chiefs set for hefty pay hike

New Delhi, May 30 The Chief Executives of top level Central public sector enterprises (CPSEs) may soon get Rs 1 lakh a month as basic pay and allowances of up to 50 per cent of the basic.

In addition, there would be certain new elements in the total pay structure in the form of risk pay (10 to 20 per cent of basic), difficult area allowance (15 per cent), North-East allowance (12.5 per cent), underground mines allowance (10 per cent) and a 25 per cent non-practice allowance for doctors employed with CPSEs. The recommendations also include formulating ESOPs for the companies.

These recommendations were submitted to the Government today by the second pay revision committee for CPSEs and cover over 2.5 lakh executives in the CPSEs.

Though the new scales are recommended for implementation with retrospective effect from January 1, 2007, the Government is likely to take a final view before the year-end.

The salaries of the remaining 13.5 lakh non-executive employees in the CPSEs would be decided by the company management through internal negotiations, the Minister for Heavy Industries and PSEs, Mr Santosh Mohan Dev, said. The Ministry would now place these recommendations before the Cabinet, he said and added that “we hope that the Government would bring this to effect this year .”

Multi-layers

The Director-General of Standing Conference of Public Sector Enterprises (SCOPE), Dr S. M. Dewan, told Business Line that “It will take another one or two days to calculate the exact quantum of increase as the CPSEs are categorised into five groups, each having its own scale and there are various levels of executives.”

For Directors on CPSE boards, the basic pay will go up from Rs 50,000 to Rs 80,000 a month. The increase in the basic pay of below board level executives would be between Rs 11,500 and Rs 70,000.

Minimum hike

The lowest level executive of the lowest CPSEs (those referred to the BIFR) would get a raise of Rs 11,500 a month while the highest employee (below board level) of the best CPSEs such as ONGC and SAIL would get a raise of Rs 70,000 in their basic pay, Dr Dewan said.

The risk pay will be applicable to only those CPSEs that are making cash profits, However, the risk pay element would not be factored in for calculating allowances such as DA and HRA . The HRA rates have been fixed at 30 per cent, 20 per cent and 10 per cent depending upon the classification of the cities/towns based on population.

The committee has also recommended variable annual increment in the range of two to four per cent of the basic instead of the present fixed amount.

No cap on gratuity

Performance-related variable pay would range between 40 per cent and 200 per cent of the basic pay. There would also be no limit on gratuity.

However, Mr Dewan said that “the ceilings put on performance-related pay have, to some extent, restricted our ability to prevent flight of critical skill to the private sector.

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