What is OBC Creamy Layer and What Changes are Expected in New Cut-off Criterion: News18 Explains

What is OBC Creamy Layer and What Changes are Expected in New Cut-off Criterion: News18 Explains

New Delhi: The union cabinet is soon expected to take up the issue of revision of cut-off criteria for the ‘OBC creamy layer’. Group of Ministers (GoP) is currently deliberating on various aspects of the issue, including the revision of cut-off salary from present Rs 8 lakh to Rs 12 lakh.

The move is expected to have financial repercussions, but can ruffle feathers in the political sphere as well. The crucial state of Bihar, where OBC comprises 40% of the population, is scheduled to go to polls later this year and how the new changes will impact the poll mood.

To understand as to why the OBC creamy layer criteria is being revised and its implications, let us try and answer a few questions on the subject.

What is creamy layer?

To begin with, reservation did not have any riders in terms of income and caste was the sole criterion. The concept of 'creamy layer' was introduced by the Supreme Court in 1993 through the judgement it delivered in the Indira Sawhney case. In its judgment, the top court ruled that the exclusion of such socially advanced members...will make the ‘class’ a truly backward class.”

After being introduced, the criterion of income has been periodically revised. In 2013, it was revised from Rs 4.5 lakh to Rs 6 lakh. In 2017 it was revised to Rs 8 lakh. This means that any family in the Other Backward Sections (OBCs), which are entitled to 27% reservation in higher educational institutions and public sector employment, whose gross annual income is over Rs 8 lakh cannot avail of reservations.

Who is revising this criterion now?

The income-related criterion is subject to revision every three years and currently the GoP, headed by Defence Minister Rajnath Singh, Home Minister Amit Shah, Transport Minister Nitin Gadkari, Social Justice Minister Thawar Chand Gehlot and Mos External Affairs V Muraleedharan, is deliberating over the issue.

The GoP has to finalise the details of the revised criteria and submit it to the union cabinet which will then after due considerations implement these changes through a notification.

What changes are likely to be made?

No official statement has been made on this issue, but a few media reports have suggested the following changes that are likely to be made to creamy layer

1. All taxable income including salary be counted in computing the gross annual income.

2. The income ceiling be increased from Rs 8 lakh to Rs 12 lakh. Some media outlets have reported that the GoP is considering having two separate income ceilings - Rs 12 lakh for urban residents, Rs 9 lakh for rural residents. This is in tandem with a proposal submitted in 2011 by the National Commission for Backward Classes. It had proposed that income criteria for creamy layer should be different as gross income levels were lower in rural areas. It proposed Rs 9 lakh for rural and Rs 12 lakh for urban areas as income limit for creamy layer classification. However, the proposal was not accepted.

3. Include all those with landholdings of over 10 hectares of which at least 4 hectares is under irrigation, in the creamy layer.