Govt rules out hike in OBC 'creamy layer' income limit

The Centre has made it clear that it has no plan to raise the income ceiling for ‘ creamy layer’ for OBC reservations, though the last revision took place eight years ago and is now twice overdue, as per a Times of India report. There is at present an annual income bar of Rs 8 lakh for the purpose.

An OBC family with an income above the set limit does not qualify for reservations in government jobs and educational institutions. The government believes that raising the ceiling would primarily benefit a small portion of OBCs while increasing competition for the economically weaker OBCs. Keeping the ceiling lower excludes the wealthier OBCs and favors those with limited financial resources competing for the same reserved opportunities.

According to the norm, income ceiling should be revised every three years to factor in inflation, so that the economic criterion for quota eligibility, as defined by the ‘creamy layer’, does not become regressive and hurt the backward classes. The ceiling was last revised in late September 2017 from Rs 6 lakh to the existing Rs 8 lakh and was due for a revision in October 2020. It was to be revised again in 2023, but govt has refused to move ahead on the issue. The parliamentary Committee on Welfare of OBCs, headed by BJP MP Ganesh Singh, in its 7th report, had impressed on department of personnel & training and the social justice ministry the need for a revision of the income ceiling.

While central govt in February 2020 did initiate a Cabinet proposal to hike income ceiling from Rs 8 lakh to Rs 12 lakh, the issue kicked up a controversy as the social justice ministry sought an overhaul of the norms to include “salary” in the computation of “income”. According to the 1993 OM that governs “creamy layer” and also defines “income”, “salary and agricultural income” are not included in the calculation, and only “income from other sources” forms part of the “total income”.

The row forced govt to put the proposal in deep freeze. Since then, there have been demands that govt decouple the two proposals — on overhauling the definition of “income” and revising the income ceiling to Rs 12 lakh — and move on just the latter proposal. But the social justice ministry refused to do so, calling it a reform package.

(With TOI inputs)