New Performance Management Scheme Introduced in FBR

ISLAMABAD: A significant overhaul aimed at enhancing the efficiency of the country’s civil services has been initiated with the introduction of a novel performance management scheme within the Federal Board of Revenue (FBR) for Customs and Inland Revenue. This initiative is slated to extend across all services and cadres of the Central Superior Services, superseding the existing, allegedly flawed Performance Evaluation Reports (PERs) system.

Prime Minister Shehbaz Sharif has sanctioned the scheme, which, in the context of the FBR, has adjusted the previous assessment where 98% of Customs and Inland Revenue Service officers were rated as either “outstanding” or “very good,” down to a revised figure of 40%.

Under the old framework, nearly all Customs and Income Tax officers received the highest classification (“A” category) concerning their integrity. Conversely, the revamped system will ensure that top performers receive enhanced compensation packages. Performance evaluations, along with corresponding compensation, will occur every six months.

The Establishment Division has received directives from the prime minister to scrutinize and subsequently implement the FBR’s novel performance management system across all other services and cadres within the Central Superior Services. It is anticipated that this measure will significantly impact the overall performance and efficacy of the nation’s civil services.

The architect of the new system is the current FBR Chairman, Rashid Langrial, who, in collaboration with his team, conceived, tested, and successfully implemented the scheme for the most recent six-month evaluation of every officer within the Customs and Inland Revenue Service.

Previously, nearly every officer was assessed as “outstanding,” “very good,” and “very honest,” regardless of their actual performance. Now, each category, from “A” to “E,” will encompass 20% of officers, evaluated through a fully digitized performance management system emphasizing integrity and work quality.

The assessment process has been designed to eliminate manipulation or undue influence. Furthermore, officers in higher grades will receive performance-based compensation.

Specifically, within the FBR, the top 20% (“A” grade) now receive four times their standard salary, the next 20% (“B” grade) receive three times, and the subsequent 20% (“C” grade) receive twice their salary, while the “D” category receives one additional salary. “E” grade officers do not receive supplementary compensation. This compensation structure will undergo biannual reviews based on performance.

The new performance management regime is structured to resist manipulation or interference and operate independently of individual biases.

The system, already piloted with over 1,500 Customs and Inland Revenue Service officers, involves each officer being reviewed by 45 peers (seniors, juniors, colleagues) every six months via an anonymous forced-ranking system. This system ensures that each category is limited to 20%, preventing an overabundance of “outstanding” officers.

The digitized system employs sophisticated cybersecurity measures to maintain the anonymity of the 45 peer reviewers. Access is restricted to the FBR chairman and three members, who cannot alter or manipulate individual reports. These members can only access the data jointly, and any unauthorized activity triggers notifications to multiple individuals, preventing unilateral changes.

A four-stage criterion identifies the 45 peer reviewers for each officer. Alongside peer evaluations of integrity, a technical panel assesses work quality, randomly selecting officers for review.

The FBR has successfully concluded the assessment of all its officers under the new system for the latest six-month period.