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PRI (Performance related incentives)

April 10th, 2008 · No Comments

While discussing government performance, the role of employee’s performance can’t be ignored. Policy makers who are engaged in finding ways and means to improve government economy, efficiency and effectiveness need to address the problem of employee performance, particularly motivating employees and rewarding according to performance. It is widely believed that the performance of government organizations is less than satisfactory because there is less distinction between high performers and low performers. If performance link systems in government is introduced then it can motivate employees to improve individual or group performance. The essence of PRI (Performance related incentives) is that Differential performance must be differentially rewarded. This is more prevalent at Senior management levels in developed countries like USA, UK, France etc.

The proposed PRI in 6th pay commission is as under :

PRI is not an assured entitlement for all employees. It is totally based on performance assessment and varies according to performance. It don’t not cover assured incentives like those given for difficult working conditions, special schemes, normal increments or promotion related pay increase.

PRI payment will be made over and above the compensation entitlement for a particular rank. The model will be “1+X” where X is expressed as a percent of the annual basic salary.

PRI payment should be done in the form of a bonus payment. Bonus will be computed as percentage of annual basic salary of the individual. Pro-rata calculation will be done for employment for part of the year.

PRI should be implemented at all levels, individually or for groups

PRI should be implemented based on multi-dimensional assessment of performance including public/stakeholder service delivery.

As per report the PRI should be introduce in a phased approach of PRI will be best suited for government the PRI scheme can be considered for introduction in ministry, departments under the ministry, subordinate or attached offices, autonomous bodies etc. each phase is focused on specific milestones to be achieved in the PRI journey. Phases were identified by the following indicators (i) employee readiness (ii) outcome focused reform commitment linked to PRI introduction and (iii) mode of financing the PRI.


For Group A Pay Band PB-3, annual increments in the band will vary depending upon the performance. Not less than eighty percent of the employees in the grade will be allowed normal increment at the rate of 2.5% with the remaining 20% high performers during the year being allowed increment at the higher rate of 3.5%. In all other running pay bands also, increments in the form of percentage (2.5%) of the total of pay and grade pay have been recommended. This has been done to enable the Government to extend the scheme of variable increments in this grade as well at a future date. While introduction of the scheme of variable increments in Groups ‘B’ and ‘C’ is equally desirable, the Commission is not recommending this as it is of the view that consultations with the Staff Side would be needed before the scheme of variable increments is extended to posts in Group ‘B’ and ‘C’. The Government may decide to extend the scheme of variable increments in running pay bands PB 1 and PB 2 as well. The proposed scheme of running pay bands do not, however, provide for variable increments in the PB-4 pay band.

Tags: Sixth Pay Commission