Government has finally decided to implement the Performance Related Incentive Scheme (PRIS)

The United Progressive Alliance (UPA) government has finally decided to implement the Performance Related Incentive Scheme (PRIS) recommended by the Sixth Pay Commission for all Central government employees. An announcement is expected in the next couple of days, government sources told The Hindu. Those government employees who make the cut will start earning their incentives in 2012.

A Committee of Secretaries (COS) chaired by Cabinet Secretary K. M. Chandrasekhar approved the broad contours of the PRIS on March 8, and asked the Department of Expenditure and Performance Management Division, Cabinet Secretariat, to work out guidelines to implement the scheme. Members of the COS included Finance Secretary Sushma Nath, who was also member-secretary of the Commission.

Any department, to qualify for financial incentives, will have to get a performance rating of 70 per cent or more on its Results-Framework Document (RFD) and implement a bio-metric access control system in its offices. As suggested by the Commission, the incentives will be initially paid out of cost savings made by the department in that fiscal year and hence there will be no additional burden on the exchequer for implementing the PRIS, government sources said. Initially, for every rupee saved by the department, it will allow to distribute up to 15 paise depending on its performance.

The PRIS will cover all employees of the department. While incentives paid to the Secretaries will depend entirely on departmental performance reflected in the RFD, incentives paid to Joint Secretaries will depend on a weighted average of their division’s performance and departmental performance. Incentives for junior employees will depend primarily on their individual performance.

However, all employees will need to go through a rigorous performance appraisal system consistent with the RFD evaluation methodology.
Indeed, incentives will start rolling out only after a department has prepared two rounds of robust RFDs, so as to truly capture departmental performance. Given that 2010-11 was the first year for implementation of 12-month RFDs, performance incentives will be paid from 2012-13 to employees who make the cut.

The decision to implement the PRIS comes in the wake of the Prime Minister’s Performance Monitoring and Evaluation System (PMES) for government departments that was approved in September 2009.
Interestingly, of the departments that have gone through the exercise, there have been some notable exceptions including the Ministries of Home, Finance, Defence, External Affairs, and the Prime Minister’s Office (PMO).
Objections

This has led to objections from officials of other Ministries: the feeling is that these key ministries and departments influence the work of other departments, and unless they, too, are brought under the scanner, the RFD will be redundant and unproductive.

The view from the Cabinet Secretariat is that the Prime Minister did not keep any department out of the ambit of the evaluation process, but it was felt that it would be better to implement it in phases for practical, operational reasons.

The original idea was to cover all 84 ministries and departments – it started with 59 departments in the last quarter of 2009-10, and currently covers 62 departments.