The finance ministry has, in principle, approved a 25 per cent increase in house rent of government employees as part of a monetisation plan, which will replace different facilities provided to them with a fixed monthly amount in their salaries.
According to an official of the finance ministry, the ministry took the decision after reviewing a summary submitted by the Ministry of Housing and Works based on recommendations of the pay and pensions commission about monetisation.
However, the final decision will be taken after the Ministry of Housing and Works provides an assessment of additional expenses in the face of increase in house rent.
The official said the housing ministry, in its summary, had sought an 80 per cent increase in house rent ceiling, but the finance ministry reduced it to 25 per cent, saying the housing ministry’s proposal was too high, which would put extra burden on the national kitty. The finance ministry has now sought details of the financial impact of the increase in house rent.
In the first phase, the increase in house rent will be added to the salaries of government employees in a bid to stop allotment of houses.
According to the official, the recommendations of the pay and pensions commission, headed by Dr Ishrat Hussain, are being studied for a long time, but they have not been implemented due to fears of heavy additional expenses and other perplexities.
According to the recommendations, the monetisation plan will be implemented in phases. First, those employees, who have not been provided any housing facility, will get an increase in house rent and those having such facility will see their houses and flats auctioned. However, they will be offered a 10 per cent concession if they show interest in purchasing these houses.
Another summary for withdrawing vehicle, petrol and other facilities from government officers of Grade 20 to 22 and replacing them with a Rs40,000 to Rs60,000 allowance per month, has been sent to the cabinet division. This is also expected to be approved soon.
Grade 20 officer will get an allowance of Rs40,000, Grade 21 officer will get Rs50,000 and Grade 22 officer will get Rs60,000. The employees can also purchase government vehicles by depositing down payment while vehicles of those employees who do not opt for this, will be auctioned.
The withdrawal of vehicle facility will lead to a saving of Rs1.6 billion this fiscal year as different government departments had demanded release of this amount for purchase of new vehicles. In addition to this, money spent on repair and maintenance of vehicles and salaries of drivers will also be saved.
Published in The Express Tribune, September 15th, 2011.