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No Small Government, This

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It’s common in India for folks to clamour for Government jobs. You also keep hearing that Government is scaling down gradually. The figures don’t quite reflect that. Let’s look at the federal or central government figures for India. From approximately 3.2m in 2001, total employee strength rose to 3.3m, then dipped again to 3.2m by 2006 and rose again in 2010 to 3.3m and is presently at these levels. Though again between 2010 and 2011, the figure rises by almost 25,000. No downsizing here.


Interestingly, the Government’s own census of Government employees shows total employees in 2001 at 3.8m. So, about 600,000 employees are either ghosts (not unusual) or there is a difference in accounting for regular and non-regular employees. The census document says regular employees incidentally. Almost 40% of Government employees belong to the Ministry of Railways, followed by Communications & IT (16%), Defence-Civilian (15%) and Home Affairs (15%). Incidentally, women were around 7.5% of the workforce.


Let’s look at total expenses. From Rs 583,387 crore ($129 billion) in 2006-07, it’s risen to Rs 1,10,8749 crore ($246 billion) in 2010-11. In Rs (Lakh) this means average expenditure per employee (not on the employee) in Government per annum is Rs 32 lakhs or $71,000.


Rising Costs


The salary paid is around Rs 3,04,128 per annum ($6,758), approximately 10% of total Government expenditure, which is modest. But this is what is paid and does not reflect the monetised value of various other perks (including housing) which may only partly show up under expenditure. Let’s show you how the total Pay & Allowance figure for central Government officials has risen in recent years.



Now, as per Government figures, pay forms 9.9% of total Government expenditure. However, as a percentage of tax revenue (net to Centre) it’s 25% for 2009-10. So, a quarter of your tax rupees are paid as Government salaries.


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