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Huzaima Bukhari & Dr Ikramul Haq
According to a news story, the coalition government of Pakistan Tehreek-i-Insaf (PTI) has recently convened a meeting to consider early retirement of inefficient and corrupt civil servants belonging to various occupational groups and services. As per report, an official letter has been issued by the Establishment Division requiring consideration of the cases of Basic Scale (BS)-20 and above officers, having completed 20 years of service, to be considered by Department Review Board (DRB) for early retirement. The Chairman Federal Public Service Commission (FPSC) will chair the DRB with the secretaries of Establishment Division, Cabinet Division, Finance Division and Law and Justice Division as its members.
The letter by the Establishment Division indicates that the government is evolving necessary processes to weed out inefficient and corrupt government officers. In line with the changes made in the laws, rules and procedures governing civil servants conduct recently, all ministries and divisions have been directed to constitute Retirement Boards (RBs) and Retirement Committees (RCs) so that the process of early retirement could be initiated in line with legal provisions.
The report further reveals that necessary formalities have been completed by the Prime Minister’s office in accordance with legal framework adopted and instructions issued for early retirement of officers as per policy guidelines. Among others, the criteria for early retirement include three or more average Performance Evaluation Reports (PERs) or adverse remarks by different Reporting and Countersigning Officers or twice not recommended for promotion by the Competent Authority. Those who have been found corrupt or entered into plea bargain with various government agencies such as National Accountability Bureau (NAB) will also be purged.
Additionally, these cases will also include those who have been given Category ‘C’ by Central Selection Board (CSB), Department Selection Board (DSB) or Department Promotion Committee (DPC) owing to various reasons. For early retirement of BS-19 and officers below, the government has set up committees in every ministry and division so that suitable cases could be recommended and sent to the Competent Authority. This is the framework that the Government has finalised to weed-out deadwood from the civil bureaucracy.
In the backdrop of these developments, it is pivotal to frame a robust administrative framework for identifying and weeding out deadwood from the Federal Board of Revenue (FBR). The first step is to identify those officers who managed to get senior positions in FBR through backdoor channels and became part of regular occupational groups bypassing selection through the Central Superior Services (CSS) examination for the posts of Inland Revenue Service (IRS) and Pakistan Customs Service (PCS). This aspect is completely overlooked by the PTI Government in its policy of weeding out deadwood (many call it “deadly” as well) from Revenuecracy.
A group of officers was inducted in FBR as Income Tax Officers (ITOs) way back in 1999 and these non-CSS officials were promoted as Additional Commissioner IRS as mentioned and discussed at length in ‘A detailed anatomy of FBR—I , Business Recorder, November 16, 2018 and A detailed anatomy of FBR—II, November 21, 2018 wherein it was stated as under:
Another small cadre of officers was inducted by government of Pakistan People Party as Assistant Collectors Sales Tax (BS-17). Following the IROs induction into the main stream IRS cadre, this small cadre of officers also succeeded in getting inducted into the IRS… Another group of officers are auditors who were inducted in FBR in BS-16. They… promoted to BS-18…”
The IRS has many officers who joined the service on positions that could only be filled by passing CSS examination, allegedly using political influence and other means! Their induction was in utter violation of law. Similarly, many officers from other occupational groups, much below the merit of IRS in CSS also managed to join under section 10 of the Civil Services Act, 1973 and promoted to BS-20 in violation of Para 5 of Office Memorandum of Establishment Division issued on November 12, 2007 reading: “It has therefore been decided that the service rendered by a civil servant against higher post under Section 10 of the Civil Servants Act, 1973 cannot be treated at par with the service rendered by regularly promoted officers in the higher scale for the purpose of promotion to the next higher grade”.
These are now senior most officers in Grade-19 and many of them have undergone Senior Management Course (SMC). It means they will be promoted to BS-20. They are around 40 officers who are placed in the main IRS merit list with that of 29th and 30th Common Training Programmes (CTPs). Nobody in the PTI Government has realised that this is the worst compromise that FBR has ever made by appointing non-CSS officers at the senior most levels. If, immediate remedial measures are not taken, this group in 2023 will occupy all the posts of Members of FBR and even Chairperson. This is and will be in flagrant violation of Article 240 of the Constitution read with amended and updated Civil Services Act, 1973, Civil Servants (Appointment, Promotion and Transfer) Rules, 1973, many rules and regulations issued by the Establishment Division from time to time, available at their website under the icon Laws/Rules/OM: https://www.establishment.gov.pk/
The above need the immediate attention of Prime Minister and his Special Assistant on Establishment, Mohammad Shehzad Arbab, Secretary Establishment and Chairman FBR. Pakistan Administrative Service (PAS) has recently devised a mechanism [available on the website of FPSC: http://www.fpsc.gov.pk/news/induction-officers-pmspcs-pas] through which the Provincial Civil Services (PCS) or Provincial Management Service (PMS) Officers can be inducted into the PAS through a competitive examination taken by the FPSC. In case of ITOs inducted into IRS, no such examination was taken. As a result, these ITOs are all set to be promoted to BS-20 without going through CSS examination. It is time that same mechanism as adopted by PAS should be applied in their case as well.
The new policy of the PTI Government to weed out deadwood needs appreciation and it must be applied across the board. As discussed above, some very good officers in FBR may have came through back channel, and the option for them should be the same as in the case of PAS that they should come through FPSC. There is urgent need not only to regularise their matters but also identify deadwood in FBR comprising CSS officers on the basis of criterion applied for all the cases.
This article clearly identifies the ITOs’ batch, occupying senior positions, as “the chronically dead” workforce of FBR. If this deadwood is not eradicated, the future of FBR will be in the hands of non-CSS officers, in utter violation of the Constitution and at the cost of making FBR a unique organisation run neither by CSS officers nor the competent ones.
In 2012, the Government of India facing the same problem with civil services issued a letter to its Central Board of Direct Taxes (CBDT) by which a detailed scheme for removal of “deadwood” was formulated. The letter pointed out that a few members of the All-India Services had become mere passengers in their post. They became either stale or listless lacking creativity and thus failed to achieve results. The letter said that this situation resulted in the operation of the “Peter Principle”—every man rises to the level of his incompetence from where he can go no higher. The scheme provided for the identification and compulsory retirement of such employees so that the cost to the exchequer was saved. It is high time that newly-appointed Finance Minister, Shaukat Fayaz Ahmad Tarin, also applies Peter Principle and removes the deadwood from FBR.
In case, FBR fails to perform, the federation and its units will suffer heavily and this can lead to more indebtedness. As per Summary of Consolidated Federal and Provincial Fiscal Operations, 2020-21, for the first six months of the current fiscal year, out of FBR collection of Rs. 2.2 trillion, Rs. 1280 billion) were transferred to the provinces under 7th National Finance Commission (NFC) Award. The net amount available with Federal Government after including non-tax revenues of Rs. 861.6 billion), was Rs. 1.79 trillion that could not even meet the two major heads, debt servicing (Rs. 1475 billion: domesticRs. 1357 billionandforeign Rs. 118 billion) and defence (Rs. 486.5 billion). All the facts and figures relate to the single most disturbing factor that even Rs. 171 billion were borrowed for defence needs. It is more than a fiscal fiasco—a serious cause for concern threatening economic viability and national security of the country.
There is not even an iota of doubt that ITOs’ batch, now senior BS-19 officers of IRS, ready to be promoted to BS-20, may be retired or asked to come through FPSC. In case they escape the Government’s policy to weed out deadwood by entering into IRS violating the law of the land, it will be great injustice with those who came through CSS examination. This will further compromises and will further dilute the capacity and capability in resource mobilsation efforts on which the survival of the State now rests.
The removal of deadwood in FBR and elsewhere in bureaucracy has become inevitable if we have to achieve growth and efficiency and improve overall governance in the country. The main reason of low revenue collection is weak fiscal management, corruption, inefficiency and policies of appeasement towards tax evaders, for which the successive governments are equally responsible.
It is thus, imperative to remove deadwood (after fulfilling requirements of Article 10A of the Constitution that is fundamental right of all citizens) and make FBR an efficient body, headed by competent and professional managers. The same shall be the case for all governmental departments and state owned enterprises (SOEs) before these are privatised as the Peter Principle shall be applied indiscriminately in all institutions.
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The writers, lawyers and partners of Huzaima, Ikram & Ijaz, are Adjunct Faculty at Lahore University of Management Sciences (LUMS).