PESHAWAR, Jan 29: The NWFP caretaker government has abolished the policy of hiring low-grade employees on fixed pay and regularised the services of 22,670 workers inducted earlier, it is learnt.

A notification in this regard was issued here on Tuesday by the finance department, official sources told Dawn. The previous MMA government had announced scrapping of the fixed-pay policy, but it was formally notified by the caretaker set up.

Under the new policy, the 22,670 workers were given basic pay scale 1. Their pay will be determined on the basis of the date of their recruitment, and officials will not be entitled to arrears.

Officials regularised under the NWFP Civil Servant Act, 1973, would be entitled to contributory provident fund, the sources said.

They said the employees would be paid the fund on retirement which would be alternative to pension. They would also be provided with medical facilities.

The fixed-pay policy was formulated by the provincial government headed by Governor Iftikhar Hussain Shah. The policy was aimed at curtailing non-developmental expenditure and getting rid of pension liabilities of the employees. The then government had decided to make low-rank recruitments on lump sum salaries. During the Muttahida Majlis-i-Amal provincial government, fixed salaries of the employees were increased on yearly basis in accordance with certain ratio.

In the last provincial budget in June 2007, the then government had announced abolishing the fixed-pay policy.

The sources said this step would increase the salary bill and financial hardships faced by the government. At present, the government’s salary bill is Rs38 billion a year.