Civil bureaucracy is having its cake and eating it too. An interesting study conducted by the Planning Commission concludes that the perks to the civil servants of BPS-20 and above cost the government Rs 4.7 billion per annum, and if administrative expanse is also considered, the amount in question reaches Rs 6 billion.
The Planning Commission in a report ‘Pakistan: Framework for Economic Growth’ has underlined that when state provides perks, it reduces productivity by not only adding to the overall expenditure (more bureaucracy is required for managing the benefits) but also encouraging rent-seeking.
It says the civil servants in the country are receiving billions of rupees in perks including transportation, housing, plots, land, membership to clubs and boards, in addition to their salaries.
However to calculate the economic impact of these advantages, the Planning Commission has focused only on two components – transport and housing.
The economic growth framework draft, made available to Pakistan Today, indicates that apart from the administrative expenditures, the government has to divert Rs 4.7 billion on account of transport and housing to the civil servants of BPS-20 and above.
The study estimates that a BPS-22 civil servant costs the government Rs 530,521 per month which includes Rs 144,316 in compensation, Rs 186,205 in transport allowance and Rs 200,000 in accommodation expense.
Additionally, a BPS-21 officer entails an expenditure of Rs 440,183 per month as the government has to pay Rs 119,019 in remuneration, Rs 171,164 transport allowance and Rs 150,000 on account of housing. Similarly, a BPS-20 civil servant means Rs 305,254 monthly, which includes Rs 107,130 in terms of salary, Rs 118,124 for transport and Rs 80,000 for house rent.
The research insinuates that if salary structures of civil servants are rationalised, not only the remuneration per officer will rise significantly but the government will also save around Rs 3 billion. In addition, it estimates that if only 50 per cent compensation is given against the withdrawal of perks, the annual cost to government will be reduced to Rs 900 million.
Talking to Pakistan Today, a senior tax consultant said though every public institution had become a white elephant for the cash-strapped country, the Federal Board of Revenue (FBR) was the worst example. The FBR is charged with collecting revenues for national development, but tax machinery consumes a major chunk of revenues on account of salaries and perks.
He pointed out that the FBR was the only institution in the country where civil servants drew double salaries and unlimited perks. Initially, the government allowed double salaries to the FBR officials working in regional tax offices (RTOs), large taxpayers units (LTUs) and medium taxpayers units (MTUs) while considering their performance. But afterward it was replicated for the whole tax machinery without considering performance standards.
A retired civil servant said the time had now come for senior officials to acknowledge the fact that the status quo could not be maintained. However, considering his own experience, he opined that it might prove difficult for the weak coalition government to implement serious reforms with respect to the compensation for the civil servants.