THURSDAY, APRIL 25, 2024
Centre mulls performance-based bonus TEAM HERALD NEW DELHI: The government is ready with an incentive bonus scheme for the central staff to reward those cutting costs without compromising with quality and effectiveness of delivery of services. The draft guidelines are out but no date yet specified for implementing the scheme.
The scheme is to allure the staff to reduce the non-plan expenditure and take home a percentage of the government's savings as a "performance-related incentive (PRI)." They will be rewarded with higher and higher incentive if they keep up the tempo year after year.
The benefit will accrue right from the secretary level to the lowest staff, provided the ministry or department scores not less than 80 per cent composite score by not only reducing costs compared to the previous year but also achieves excellence in the delivery of services and other performance commitments.
The proposed annual incentive is 20 per cent of the basic salary for the highest composite score of 100 per cent in performance that goes up to 30 per cent from fourth to sixth years and 40 per cent thereafter.
The score of 90 per cent will entitle the employees with the incentive payment of 10 per cent of the basic pay that will go up to 15 per cent in Phase 2 from fourth to sixth year and 20 per cent in Phase 3 of sixth to ninth year. The lowest incentive for 80 per cent performance is 5, 10 and 15 per cent of basic salary respectively in the three phases.
The public sector employees already get the performance bonus, while the government now wants to extend it to all its employees to have the performance-based pecuniary benefit over and above the regular salary, as recommended by the Sixth Central Pay Commission.
There will be no extra burden on the exchequer as the proposed incentive scheme is budget neutral as payments will come out of the budgetary savings. In fact, the scheme shall result into deficit reduction as a maximum 15 per cent of the savings will be distributed to the staff that comes out with the score of 100 per cent in the assessments.
The draft guidelines circulated to the ministries for implementing the scheme warrants team work by the employees to get the benefit as it is based on performance of their organisation. Officials said the scheme will help reduce the burgeoning government expenditure and promote accountability of the government employees.
The Cabinet Secretariat has also mounted the draft guidelines on its new website
The guidelines also give a few examples of cost cuttings and savings that may result in the proposed incentive bonus, such as use of travel vouchers / competitive prices instead of full fare travel tickets, paperless office through e-office implementation, pooling of secretarial staff and staff cars, doing away with honorarium and bonuses once performance related incentives are implemented and rationalisation of the functions, activities and re-structuring of Ministries and Departments.
Incentives for officials below the joint secretary level would depend mainly on their individual performance while the secretary becomes eligible for payment of incentives when all others in the department get covered under the scheme.
The guidelines lay down how the departmental performance will be measured for the incentive scheme, like selection of the key objectives, assigning relative weights to these objectives, specifying means for achieving them, and lay down the success indicators and targets for these indicators on a 5-point scale, where 60 per cent performance is poor ineligible for any incentives, while 70 per cent is fair but no incentive, 80 per cent good, 90 per cent very good and 100 per cent excellent.
If a particular department clocks 100 per cent, the secretary, the special secretary, the additional secretary and the joint secretary will get 20 per cent of the basic salary as the incentive payment for the first three years of performance, going up to 30 per cent in the next three years and peaking at 40 per cent in phase 3 of six to nine years. Different incentive payments are prescribed for the performance score of 90 and 80 per cent.
Given the diversity of departments and their mandates, the guidelines give a free hand to the divisional heads (joint secretaries) to devise appropriate performance-related incentives for the lower rung of employees while ensuring that they do not cross the percentages prescribed for the seniors and the scheme is approved by the secretary at the beginning of the year. This will give flexibility to each division to adopt different PRI scheme.
The guidelines also lay down an 8-point checklist of the eligibility criteria for an organisation to join the PRI scheme, requiring each one of them implemented before rolling it out for its employees.
