BRIEF

SUBJECT: PROJECT ALLOWANCE

Government of the Punjab introduced Project Allowance for the civil

servants who joined Project / Programme on their selection through competitive
process vide policy letter No.FD.SR-I/9-20/2006 dated 30.11.2006 (Annex-I) with the
following rates:
Basic Pay Scales of the Officers Project Allowance
(% of Project Allowance of PD)
19/20 60
18 50
17 40
Different Projects were categorized vide para-2 whereas terms and conditions for

appointment of officers / officials were described vide para-6 of the policy letter ibid.

Market Based Salaries for the Project Staff directly selected through open

competition and incorporation of Project Allowance in the PC-I was approved vide

para-4-5 of the policy letter of even number dated 07.02.2007 (Annex-II). It was

clarified that the policy for grant of Project Allowance would applicable to the officers

/ officials posted through transfer or internal competitive selection / open market

competition as well as professionals hired from private sector vide policy letter dated

12.10.2007 (Annex-III). The Project Allowance was discontinued to the officers /

officials working in different projects while allowing them to draw pay and such

allowances as admissible to them in their own pay scales plus deputation allowance

and additional charge allowance @ 20% of basic pay vide policy letter dated

02.06.2011 (Annex-IV). Terms and conditions for appointment and performance of

the public sector officials selected open competition were settled vide policy letter

dated 11.11.2011 (Annex-V). The performance of officers / officials working in public

sector companies was subjected to the Key Performance Indicators (KPIs) and

different targets settled by the Board of Directors vide policy letter dated 02.04.2012

(Annex-VI). Guidelines regarding salary packages to public sector officers / officials

working in public sector companies in the Punjab Government, were settled vide

policy letter dated 05.05.2012 (Annex-VII). The terms and conditions for Government

Servants posted in Government owned companies through competitive process

were reviewed for the purpose of rationalization and uniform application across the

board vide policy letter dated 20.05.2014 (Annex-VIII). Such officers’ tenure of

contract in the project was fixed for three years.

Revised rates of Project Allowance for the officers / officials appointed

/ posted in Projects / Programs through competitive process, were fixed vide para-2

of the policy letter dated 21.11.2014 (Annex-IX). General conditions for appointment

of Program / Project Director, his qualification / experience requirement and mode of

selection committee was also described in the policy letter ibid. It was clarified vide

policy letter dated 30.12.2016 (Annex-X) that the Government officers / officials

selected through competitive process on Projects / Programs Posts having

market-based salary would be entitled to market-based packages with immediate

effect whereas those officers / officials appointed / posted through competitive

process would only be entitled to monthly rates of Project Allowance in addition to

their admissible salary. It was further clarified vide policy letter dated 14.06.2017

(Annex-XI) that the policy regarding grant of Project Allowance is applicable only to

the civil servants and the same is not applicable to the employees who are recruited

on contract basis directly against the project posts and are permanent part of the

projects / programs. In a clarification recently issued by the Finance Department vide

policy letter dated 17.04.2018 (Annex-XII) it has been clarified that the policy of

Project Allowance is not applicable to private sector employees and the packages

approved for afore said employees against the post(s) in the public sector projects /

programmes has nothing to do with above mentioned policy because these packages

are governed under Finance Department’s order No.FD-SR-II/1-2/2009, dated

03.07.2015 and the order of even number dated 06.12.2017. All types of programme
/ Project Allowances / Pay Packages / Market Based Salaries and any other special

dispensation, as a part of regular pay, presently admissible in subject entities /

organizations mentioned have been discontinued with effect from July 01, 2018 and

all previous notifications / orders / procedures / guidelines in this behalf including

operation of Review and Rationalization Committee have been obviated vide policy

letter No.FD.SR-I/9-20/2006 dated 27.07.2018 (Annex-XIII).