Govt denies 'dispensation' to FBR employees

The federal government has rejected a request made by the Federal Board of Revenue (FBR) for the award of a special dispensation to the taxman's employees from grade-1 to grade-16.

In an office memo dated October 12, the Finance Division stated that on February 14, 2023, it issued a one-time special dispensation policy after the approval of the then prime minister, Shehbaz Sharif, in view of the disparities in salaries among employees of various federal departments.

The ministry, however, noted that dispensation was admissible only to the civil servants from grade-1 to grade-16 who received disparity reduction allowance (DRA). It noted that since the said employees of the FBR are not drawing the DRA, the benefit of the special dispensation cannot be extended to them.

In an office memo dated September 21, 2023, the FBR informed the Finance Division that a number of its employees had submitted "representations" for the extension of the dispensation policy to the FBR.

It mentioned that depriving the employees of the FBR of the benefits allowed to all other incumbents of the same posts/cadres was in violation of Article 25(1) read with Article 38 of the Constitution.

The memo stated that the Finance Division had already granted exemption to the employees of the President's Secretariat and the Prime Minister's Secretariat from the condition of drawing the DRA.

It explained that FBR employees are deprived of the DRA as they receive Performance Allowance. However, it noted that the Performance Allowance was hardly equal to 25% to 25% of the basic salaries of the grade-1 to grade-16 employees.

"On the other hand, employees of all other federal government departments are drawing the DRA, which is equal to 45% of their basic salaries," it said, adding that this situation was in violation of Section 3(ii) of the Civil Servant Act, 1973.

The memo added that the Finance Division clarified on February 14, 2023, that FBR employees cannot receive the special dispensation as they do not receive the DRA. However, the division later extended the dispensation to upper division clerks (UDCs) and lower division clerks (LDCs) at the FBR.

"Hence, the claim of other cadres of the FBR employees who are not drawing the DRA for the extension of the dispensation [to them] merits reconsideration, to avoid unnecessary litigation," it said.

In its response, the Finance Division clarified that the posts of the UDCs and the LDCs "are generally upgraded for all ministries/divisions/departments whether they are drawing the DRA or not." It turned down the request made in the FBR memo.