governance, political economy, institutional development and economic regulation

Babunomics for Rahul

about us image

Rahul Gandhi’s very public grabbing of the political lead on Friday, on a day when the Delhi glitterati were busy electing a new management committee for the Gymkhana, perturbed the generally convivial mood. Babus however are used to such periodic outbursts from their political masters, so the Prime Minister, sitting in Washington, must have smiled his secret smile at the wanton ways of the young and gone about his daily business of shaking hands and uttering vacuous pleasantries and platitudes.

Today Rahul’s intentions are suspect. Was it conviction or tactics that led him to rubbish the criminal bachao ordinance? If it was the former it needs to be followed up and a pattern of actions based on convictions established. He must rubbish the second tired and “populist”, vote centric measure, announced last week; hiking Babu pay by setting up the Seventh Pay Commission.

Ask any aam admi or aurat (AAAs) and their instant response will be babus are a mollycoddled, good for nothing lot, who earn more than the value they add…..the only exception being the army. Not surprising, since the value of spilling ones blood for the country or risking one’s life in civil relief operations is difficult to quibble about. Ask any babu (or army jawan) at the end of the food chain and they will painstakingly list why they can’t make two ends meet in what they earn. Ask a babu (or a general) at the very top and they will shrug their shoulders, clad in a stitch-less Arrow shirt and sigh that the government doesn’t appreciate their worth. Quite a perception gap there.

There are at least 1 billion AAAs against only around 200 million family members of the 19 million “babus” (including the army), the government employs and pays in the federal, state, local government level. Paying more to babus therefore should not make good politics.

Rahul should play to his intuition and stick with the AAAs by nixing this proposal as being untimely and wasteful but assure that the government, if re-elected, would link babu compensation to merit and performance so that they deliver more than they receive. Here is a minimalist babu reform program:

  1. Till now babu pay is indexed to inflation. Unlike the poor, babus earn more if they waste more. This can change is babu pay is indexed instead to economic growth. Freeze the aggregate wage bill of government at the existing level creating a fiscal envelop within which babus of different groups (civilians, army, technical etc.) can bargain with each other for their share of the aggregate wage bill. If babus want a higher share of GNI as pay, they will have to first grow the economy and only thereafter take a part of that that growth as their share.
  2. Ensure that the highest paid babu earns at least 15 times the lowest paid babu. This will ensure skill related compensation parity within babudom. Currently this ratio is around 11, which is very low and illustrates the well-known problem of over compensating the more numerous but less productive “bottom feeders” at the expense of the more productive but underpaid and fewer, “top feeder” babus.
  3. All perks (house, furniture, house help, official car, telephone etc.) to be monetized at market rates and taxed. Babus to be offered the option of opting for the perk or the cash. This will make transparent the Cost To Country (CTC) of a babu; avoid the existing senseless waste of perks; encourage the physical diffusion of the power elite into the respective housing, consumer durable and services markets of the cities they live in and also save them from the cold bath of retirement, when all perks are withdrawn and only a meager pension is left.
  4. Wholesale across-the-board public service reform is not politically feasible in India due to competing political interests. An option is to select a few corruption “hotspots” and critical departments for extensive restructuring and reform to meet the hitherto unmet objective of enhancing efficiency and effectiveness.
  5. There are low hanging fruits available in ports, airports, railways, roads, telecom, coal and energy. (a) They should be manned by specialized “officer” oriented cadres operating in an electronic medium, with minimal support staff. (b) All positions to be filled through a fast track Union Public Service Commission led process, by competitive selection, including from outside the cadre, on time specified contracts doing away with life time service appointments. (c) Public sector enterprises, in these critical areas, to become Board managed with a clear arms-length relationship from government ownership at the very minimum and progressively and selectively privatized.

This reform agenda will not please the left (they traditionally protect the bottom feeder babus and state owned enterprises) and the “old guard” of the congress, who have a stake in preserving the status quo. It will however endear Rahul to the young professional community and there are at least 100 million of them. Rahul should take heart from the ground swell of positive opinion he has enjoyed since yesterday by doing the “right thing” wrt his condemnation of the criminal bachao ordinance. If he truly believes that he has a legacy to live up to and a destiny to fulfill, this is another opportunity to astound us with a second outburst against more-of-the-same management of babudom. Time is running out. Modi is watching.

Comments on: "Babunomics for Rahul" (8)

  1. Can they be trusted ?

    It would be worth reading the Poll Manifestos of different political parties to find out what each promises in the matter of Women’s Representation Bill , which is pending before the Lok Sabha for over 40 years

    May be, all of them promise that , if voted to power , they will expedite the passage of this bill , which guarantees to women of India , 30 % representation in the Lok Sabha

    I urge the Women Voters ,

    When any candidate of any party turns up at your door , asking for your vote , first ask him / her :

    ” Will your party publicly declare that it will fight for 30 % seats to be reserved for Women ? ”

    If he says , ” Yes , of course ” , then ask

    > for a copy of its manifesto

    > an explanation for the following :

    Party / No of Candidates Announced / Women Candidates / %

    > Congress / 417 / 53 / 12.7 %
    > BJP / 409 / 35 / 8.5 %
    > AAP / 385 / 57 / 15 %

    Next tell him / her :

    ” Get lost / We don’t trust you / We won’t vote for you ! ”

    * hemen parekh ( 03 April 2014 / Mumbai )

  2. Advantage Rahul ?

    When Rahul Gandhi meets Prime Minister Man Mohan Singh today , we will know who wins the first round
    After a lapse of some 66 years , another Gandhi has staked his career and taken a principled stand in the matter of criminally convicted legislators
    May be , earlier he failed to convince the Old Guards
    May be the Coalition Dharma weighed him down
    May be mother Sonia miserably failed to judge people’s mood
    Now the chips are down !
    And the outcome of this meeting will reveal , either the ugly face of India’s political past or the beautiful face of a new and youthful future
    But even if Rahul wins this round , there are many more waiting to be won , before 2014 elections
    A few of these are :

     Coverage of political parties under RTI

     Electoral Reforms Bill

     Women’s Representation Bill

     Jan Lok Pal Bill …. etc

    Political future of Congress in 2014 elections will get decided by Rahul winning these rounds as well
    If Rahul continues to display the same “ Courage of Conviction “ in these rounds , he may still succeed in stealing the thunder of Narendra Modi !
    Today , a billion Indians will be watching the TV for “ Breaking the News “ !

    • hemen parekh ( 02 Oct 2013 / Gandhi Jayanti )

  3. Anil Saxena said:

    Hi Sanjeev, merely setting up of the pay commission by itself should not be construed populist. This may turn out to be double edged weapon.The past experience, at least in Armed Forces has been to the contrary. While bureaucrats are looking forward to 7th pay commission, Army (Including Navy and Airforce) is still fighting for the dues of 4th pay commission (1984). Babus at the helm of affairs tried all tricks to block the dues, including invoking SLP twice at the apex court. Memories of 6th pay commission are still fresh in the minds of Army Officers, where, the salary of the Army Officers’ was fixed in the lower bands and Chiefs had to intervene to restore the parity. In view of this, Defense Services requested for a separate Pay Commission on the lines of Railways. It appears that same has been denied. Therefore, Army does not have any feel good factor by this announcement. On the contrary Modi’s promise to implement OROP (one rank one pension) has been lapped up by the ESM (Veterans) lobby.

  4. … [Trackback]

    […] Read More here: ahluss.wordpress.com/2013/09/28/babunomics-for-rahul/ […]

  5. +1 for hinduindianh

  6. Here comes the “intellectual brilliance” and bureaucratic arrogance of a babu who, after retirement from the same coterie that de-facto rules India and splurge grossly disproportionately to its worth, now finds ample time to post matters related to self gratification. Dear Ahluwalia, all your platitudes pertaining to “perks related to economic growth” is nothing but a ruse to advocate undeserving and undesirable benefit to people of your ilk. Nobody would have bothered about this, for, pardon me if I am allowed to use a very common cliche, birds of the same feather flock together, were it not for the brazenness and shamelessness with which you assign yourself the high moral and economic authority for advocating material benefits to your kind. Both, from within and without, these ring hollow. And what better example of this pelf than “15 times the difference between the senior and Junior babu”! If you did not bother to illuminate the point that senior babus, in every department, manage for themselves, by way of “facilities, perks and discretionary powers”, we all know what these mean, much more than “15 times” the difference, we can forgive you because no one expects a person, much less a self aggrandized babu, to reveal ugly facets of babudom syndicate, of which he was not only a part, but a willing and compliant tool. I can debunk your theory for what is. I can also establish the truth, that it is at the senior level babudom wherein lies the fountainhead of corruption in India. But that’s not my call. I only wanted to call your bluff and say if this is your analysis, no wonder India is in the shape that it is. But why should I’ve bothered in the first place? Did you not sing paeans for Rahul Gandhi about his own “brilliance and power of conviction” by “denouncing” the criminal bill? Well, in a real democracy, his speech and he himself would be a national embarrassment, to say the least. But not in a democracy, as sham as ours. In any case, you’ll not let the facts about this mentally challenged man come in your way of “unabashed loyalty” to the family. Will you Mr. Ahluwalia?

  7. I am kind of surprised that your blog hasn’t got any comments so far whereas trash in TOI gets commented upon by hundreds. May be that’s the irony of India 🙂

Leave a Reply

Fill in your details below or click an icon to log in:

WordPress.com Logo

You are commenting using your WordPress.com account. Log Out / Change )

Twitter picture

You are commenting using your Twitter account. Log Out / Change )

Facebook photo

You are commenting using your Facebook account. Log Out / Change )

Google+ photo

You are commenting using your Google+ account. Log Out / Change )

Connecting to %s

Tag Cloud

%d bloggers like this: