Plan to raise creamy layer income ceiling to Rs 6 lakh on Cabinet table

The Cabinet will on Thursday take up a proposal to make Rs 6 lakh the annual income ceiling for people belonging to other backward classes

The Cabinet will on Thursday take up a proposal to make Rs 6 lakh the annual income ceiling for people belonging to other backward classes to be eligible for job and admission quota. At present,it is Rs 4.5 lakh.

The Ministry of Social Justice and Empowerment had proposed this income bar initially,but the matter was sent to a Group of Ministers after some ministers argued for a higher cut-off. The GoM headed by Finance Minister P Chidambaram finally decided in favour of the ministrys stand. The differences have led to a slight delay in the announcement of the new cut-off which is revised every four years. The last revision was in 2008.

Twenty-seven per cent seats in educational institutes and government jobs are reserved for OBCs,but those belonging to the more economically affluent category,the creamy layer,are not eligible for these reserved seats. The income bar defines the creamy layer.

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The present figure is not only lower than what ministers like V Narayanasamy had been batting for a ceiling of Rs 7 lakh per annum but also less than the recommendation of the National Commission for Backward Classes (NCBC).

The NCBC had argued that given the differential living expenses and standards in urban and rural areas,it made practical sense to fix a dual income bar rather than a one-size-fits-all formula. It had suggested that families with a minimum annual income of Rs 12 lakh in urban areas should be classified as creamy layer. For rural areas,it should be Rs 9 lakh.

The ministry,however,felt that a dual income bar was liable to cause confusion and the rural-urban cut-off differential could actually give rise to demands for further demarcation of the urban areas into Metro cities and smaller cities,all of which would then make it a very administratively cumbersome proposition. Also,dealing with migrants would become a tricky issue.

The ministry presented its point of view to the GoM which then took the final call. The GoM also favoured the ministry in its position against raising the income bar too high. The income bar cannot be set at such high levels because then it defeats the very purpose of defining a creamy layer. The idea is to ensure that the benefit of the OBC quota should go to the really disadvantaged, said a senior official.