GOVERNMENT OF ANDHRA PRADESH

ABSTRACT
Contracting and Outsourcing of Certain Services in Government Departments –
Enhancement of Remuneration – Orders – Issued.

FINANCE (HR-I - Plg. & Policy) DEPARTMENT

G.O. Ms. No.151 Dated:08-08-2016.
Read the following:-

1. G.O. Ms. No. 94 General Administration (Service-A) Department, Dated:

28.3.2003
2. G.O.Rt.No.2501, Finance (SMPC) Department, dated.13.07.2006.
3. G.O.Rt.No.4271, Finance (SMPC) Department, date 01.11.2008.
4. G.O. Ms. No. 03, Finance (SMPC-II) Department, dated.12.01.2011
5. G.O. Ms. No. 54 Finance (HR I Plg. &Policy) Department, dated: 17.04.2016
*****
O R D E R:
Government have been outsourcing certain services to effectively cater to the
needs of the Departments to supplement the regular employees to discharge their duties
more effectively. In the Government Orders 1st and 3rd read above orders were issued
laying down guidelines for requisitioning outsourced services .
2. Government have reviewed the existing system and the guidelines issued earlier.
After careful examination hereby issue comprehensive guidelines as indicated in the
Annexure I.

3. Government also revise the remuneration payable to the outsourced services as

indicated in the Annexure II of the GO. The revised rates are with effect from 1st
August, 2016 payable in the month of September, 2016.
4. All the Departments which are outsourcing services should strictly adhere to these
guidelines.
(BY ORDER AND IN THE NAME OF THE GOVERNOR OF ANDHRA PRADESH)

AJEYA KALLAM
SPECIAL CHIEF SECRETARY TO GOVERNMENT

To
All Departments of Secretariat.
All District Collectors.
All Heads of Departments.
The A.G. (A&E)/Prl. A.G. (Audit-I)/A.G. (Audit-II), A.P., Hyderabad.
The General Administration (Cabinet) Department for information.
The Registrar, High Court of Judicature at Hyderabad for the State of Telangana and the
State of Andhra Pradesh.
SF/SCs.

//FORWARDED :: BY ORDER//

SECTION OFFICER
 ANNEXURE-I
G.O. Ms. No.151, Finance (HR-I-Plg. & Policy) Department, Dated:08.08.2016

COMPREHENSIVE GUIDELINES ON OUTSOURCING OF FUNCTIONS AND

FUNCTIONARIES

I REQUISITION OF OUTSOURCED SERVICES

There are two types of outsourcing of support services. The first one is outsourcing of
functions and the second one is outsourcing of functionaries. The outsourcing
functionaries should be avoided to the extent possible.
(a) Outsourcing of Services:
(1) A Department may outsource the function, e.g., Catering, housekeeping,
security etc. to a service provider agency for a fixed period of time for a
mutually negotiated amount. Accordingly, the service provider agency will
engage a certain number of personnel and deploy equipment to meet the
specific standards prescribed for that function in the contract. In this case,
the functionaries continue to be the employees of the service provider agency
during and even after their assignment with the Department/Organization.
The charges/remuneration for these services will be provided by the service
provider/agency.
(2) The core functions should not be outsourced and should be carried out by the
regular employees.
(b) Outsourcing of Functionaries :
(1) The department may requisition the services of a certain number
functionaries, to support its employees to carry out their mandate. The
functionaries could be Office Subordinates, Office Assistants at Junior
Clerical level with Word Processing skills, Computer Operators, Drivers etc.
for a specific period. The service provider/agency selects and employs the
functionaries as per the requirements of the job and places their services at
the disposal of the Department/Organization for a fixed amount. However,
the functionaries continue to be the employees of the service agency during
and after their assignment with the Department.
(2) The outsourcing of functionaries should be only against the sanctioned post.
These should be initial recruitment posts and promotional posts should not be
outsourced. The remuneration for these functionaries will be paid by the
service provider/agency.
II. SELECTION OF SERVICE PROVIDERS
(1) The process of the selection of service providers shall be by following due
tender process.
(2) The selection shall be in a transparent and competitive method.
(3) The tender document shall contain the description of the service requisitioned
clearly indicating the deliverables, milestones. In case of functionaries it shall
contain the requirements such as qualifications and qualities of functionaries
to be provided with proficiency requirements clearly specified.
III. TERMS AND CONDITIONS OF OUTSOURCING CONTRACT
(1) The contract shall specify the nature and quality standards of the service
required from the agency and the number of persons in various categories
with their respective qualifications and experience, the equipment and other
consumables to be supplied by the agency, the time period of the contract,
the rates of payment prescribed for various functions and functionaries and
the penalties for various types of likely defaults in satisfactory rendering of
the services.
(2) The concerned Departments/heads of administrative units shall ensure that
the prescribed equipment, consumables and number of persons with proper
qualifications and training are deployed by the service provider at all times in
accordance with the outsourcing contract.
(3) The Departments shall also reserve the right to demand change of
equipment/personnel if their services are not found to be satisfactory, in
addition to levying penalties as per the terms and conditions of the contract.
(4) If the service continues to be unsatisfactory, the Department/competent
authority shall exercise its right to not only recover damages but also to
terminate the contract and replace the service provider with an agency kept in
the reserve from the tender process.
IV CONSIDERATION FOR SERVICE PROVIDERS FOR FUNCTIONARIES
(1) The service providers be paid a commission not more than 5% of the
remuneration paid to the functionaries. The remuneration paid to the service
provider is exclusive of the remuneration provided to the functionaries. In
other words, the service provider shall not charge any fee/commission from
the functionaries or deduct any amount other than employees’ share of
Provident fund.
(2) The quote by the service provider shall include the commission, the
employer’s contribution, ESI and Service Tax with a clear breakup of all
these items.
(3) The service provider shall deduct employees’ contribution to Provident Fund
and remit it along with the employer’s share to the EPF fund and remits it to
the EPF account of the employee.
V CONTRACT WITH THE SERVICE PROVIDER
(1) The Head of the Department or the head of the Administrative Unit, as the
case may be, shall be competent to enter into a written agreement with a
registered service provider agency, which holds a valid licence under the
Contract Labour Act issued by the competent authority, to provide the
contract labour and has sufficient experience to render the relevant services.
(2) The department shall also keep at least two more service providers in reserve,
on the same terms and conditions, to step in at short notice if the selected
service provider defaults in providing satisfactory service, and the contract
has to be terminated
(3) No outsourcing contract shall be for a period of more than one year. Subject
to the need and justification, and satisfaction of the competent authority, such
contracts may be extended on mutually agreed terms for one year at a time,
subject to the condition that the total period of the contract shall not exceed
three years at a time. At the end of three years, the Department shall
 necessarily go through the whole process of calling fresh tenders, giving
equal opportunity to other service provider agencies.
(4) While entering into contract, the Department should ensure that the service
provider possess proper licence from the Labour Department and check the
antecedents of the Service Provider.
VI ACCOUNTING OF EXPENDITURE
(1) The expenditure on outsourcing of functions (services) shall be debited to
sub-detailed heads ‘300 – Other Contractual services.
(2) Usual Treasury Control shall apply and therefore, all departments shall
ensure that adequate provisions are made in their budgets to meet the costs.
(3) Further the concerned Treasury Officers shall not pass any bills if they are
not verified to be under proper and currently valid government sanction.
VII GENERAL
(1) The Head of the Department and District Collectors may also prepare rate
contract of service providers to facilitate the process of outsourcing by
offices.
(2) The Head of the Office should ensure that the Rule of Reservation is
followed scrupulously requisitioning the functionaries from the outsourced
agency as indicated in the departmental website of the Social Welfare
Department
(http://apsocialwelfare.cgg.gov.in)
(3) The service provider shall remit the amount of remuneration directly to the
individual Bank account of the functionary.
(4) The Departments should check periodically at regular intervals that service
provider is remitting the amounts of EPF deducted from the functionaries
along with the employer’s contribution to the EPF accounts of the employees
and paying ESI promptly by duly verifying the challans. They shall also
verify the ESI cards of the functionaries obtained by the service provider
from ESI Corporation.
(5) All the guidelines issued in this regard shall continue to apply unless
otherwise modified in this order.
(6) The permission accorded in the G.O. fifth read above shall be extended up to
31st July, 2017.
(7) All the Departments shall invariably obtain Government permission to
outsource functionaries. The audit officers shall not admit any claim of the
remuneration of functionaries without the concurrence of the Finance
department
(8) Remuneration for all the outsourced functionaries should be supplied by
service provider in any category in all Departments shall be governed by this
Government Order henceforth

SECTION OFFICER
 ANNEXURE II

G.O. Ms. No.151, Finance (HR-I-Plg. & Policy) Department, Dated:08.08.2016

REMUNERATION TO THE FUNCTIONARIES THROUGH OUTSOURCING

Sl. Contract / Outsourced Category Enhanced

No. Remuneration per
month Rs.
1 Category –I
17,500
1. Senior Assistant*
2. Senior Steno
3. Senior Accountant*
4. Translator
5. Data Processing Officer
6. All other categories of services similar to
posts carrying the scale of pay in RPS
2010.
Rs.10900 – 31550, Rs.11530 -33200,
Rs.11860 – 34050, Rs.12550 – 35800,
Rs.12910 – 36700 and Rs.13660 - 38570

2 Category –II
1. Driver 15,000
2. Junior Assistant
3. Junior Steno
4. Typist
5. Telephone Operator
6. Storekeeper
7. Photographer
8. Data Entry Operator
9. Data Processing Assistant
10. Electrician
11. Mechanic
12. Fitter
13. Librarian
14. Lab Assistant
15. Cinema/Film/Audio visual Operator
16. Supervisor
17. Manager*
18. All other categories of services similar to
posts carrying the scale of pay in RPS
2010.
Rs.7960-23650,Rs 8440 – 24950,
Rs.9200-27000, Rs.9460 – 27700
and Rs.10020 - 29200

3 Category –III 12,000

1. Office Subordinate
2. Watchman
3. Mali
 4. Kamati
5. Cook
6. Chowkidar
7. Cycle Orderly
8. Lift Operator
9. Lab Attendant
10. Dafedar
11. Jamedar
12. Roneo/Xerox Operator
13. Record Assistant
14. Shroff*/Cashier*
15. All other categories of services similar to
posts carrying the scale of pay in RPS
2010.
Rs.6700 – 20110, Rs.6900-20680,
Rs.7100 – 21250, Rs.7520 – 22430,
Rs.7740 – 23040 and Rs.7960 - 23650

* To the existing incumbents only. No outsourcing for these categories hereafter,

SECTION OFFICER