Finance ministry rules out raise in salaries

Over five dozen govt organisations, labour unions threaten indefinite strike

ISLAMABAD:

The finance ministry has once again ruled out the possibility of immediately increasing salaries and perks of civil servants despite a threat of indefinite strike by over five-dozen government organisations and labour unions from the next week.

The interior ministry has feared that the Pakistan Democratic Movement - an alliance of 11 opposition parties, may hijack the employees protest, showed an official correspondence between the interior minister and the Prime Minister’s Office. The employees of the state-owned enterprises, pensioners and labour unions have announced to stage an indefinite sit-in in Islamabad from Tuesday. Interior Minister Sheikh Rashid Ahmed had recommended that minister for finance may immediately meet the clerks’ leadership and announce some way forward. However, the finance ministry did not agree to the proposal of immediately announcing the monetary benefits to thwart the protesters, according to the sources.

They said that finance minister chaired a meeting this Thursday, which was also attended by key cabinet ministers and chairperson of the Pay and Pension Commission. But the meeting did not last long, leaving the government with the option to handle the protestors ‘administratively’, said the sources. “The government is sympathetic towards the legitimate needs of government servants and this is why the Pay and Pension Commission has been constituted,” said Finance Secretary Kamran Afzal. The commission is working with a sense of urgency and will submit its recommendations very soon, he added. Afzal said that the government was already working to address the grievances of the employees and this was not because of the call for a sit in, but because it is something that was genuinely required to be done.

But the Pay and Pension Commission needed some time to complete its work and the finance ministry has not yet hired an actuary to assist the commission, said the sources. Any relief to the employees can only be given in the next budget, said a senior finance ministry official. The interior ministry has informed the Prime Minister’s Office that 61 organisations including clerks, employees of autonomous bodies of Pakistan International Airlines, Utility Stores Corporation, PIMS, Radio Pakistan, Allama Iqbal Open University, PTCL, Oil and Gas Development Company Limited, pensioners and labour unions have called for a protest inside red zone on January 12. The government employees were demanding increase in their basic salaries by up to 100%, increase in their house allowance, medical allowance, conveyance allowance, and upgrade in posts of the clerks. The initial estimates show that the annual cost of these demands was over Rs100 billion that the Ministry of Finance was not in a position to bear due to budget deficit related conditions, set by the International Monetary Fund (IMF).

The Pakistan Tehreek-e-Insaf (PTI) government has not increased the salaries of the employees in this fiscal year despite close to double-digit inflation in the past two years and nominal increase in salaries in the previous fiscal year. The defence minister led committee has thrice met with the representatives of the unions but so far no breakthrough could be achieved, according to a correspondence between minister for interior and prime minister’s secretary. The interior minister stated that the protestors plan to stop working in the departments until their demands were met. This sit in may prolong and PDM may try to rope in their leadership and gather strength. Already PDM has announced a call outside Election Commission of Pakistan on January 19, according to Rashid.

The interior ministry has recommended that in case no breakthrough is achieved, strict directions be given to all chief ministers and chief secretaries not to allow the protestors to come to Islamabad. The government employees are also demanding parity in their wages and perks, as there are around 26 civilian and military departments that are getting 50% to 100% higher than the standard pay packages for rendering “extraordinary services”. The federal government also gave special allowances to the Federal Investigation Agency (FIA) and the National Accountability Bureau (NAB) that created unease among the employees of the Pakistan Secretariat - the seat of federal bureaucracy.

The federal government’s pay structure has not remained lucrative after two provincial governments approved additional allowances of up to 150%. The finance ministry is pinning hopes on the Pay and Pension Commission report, which may take at least one to two years to finish the job. However, the commission could give its interim recommendations on the issue of increasing the salaries of the government employees before June next year.