With the 2024 Budget approaching, the government has received a proposal to establish the 8th Pay Commission. This commission would review the basic pay, allowances, pension, and other benefits for central government employees and pensioners.
Shiv Gopal Mishra, Secretary of the National Council (staff side, Joint Consultative Machinery for central government employees), wrote to the Cabinet Secretary, urging the government to prioritize forming the 8th Pay Commission.
A central pay commission is established every ten years to review and suggest changes to the pay structure, allowances, and benefits of central government employees, considering factors like inflation.
The 7th Pay Commission was set up by former Prime Minister Manmohan Singh on February 28, 2014, with its recommendations taking effect from January 1, 2016.
The 8th Central Pay Commission is expected to start on January 1, 2026, following the usual ten-year interval. However, the government has not yet formally announced its establishment.
After the 2024 Lok Sabha Elections and the re-election of Prime Minister Narendra Modi for a third term, over 1 crore central government employees are awaiting updates on the 8th Central Pay Commission.
Mishra noted that inflation used to be between 4% and 7%, but after COVID, it has increased to an average of 5.5%.
“The post-COVID inflation is higher than pre covid levels. If we compare the retail prices of essential commodities and goods which are required for daily life from 2016 to 2023 they have increased by over 80% as per the local market, but we are provided only around 46% Dearness Allowance as of 1/7/2023. Hence there is a gap between the actual price rise and DA provided to the employees and pensioners,” he said as per the letter.
Mishra suggested that the pay matrix should be reviewed periodically rather than waiting ten years.
“It can be reviewed and revised on the basis of the Aykroyd formula which takes into consideration the changes in prices of the commodities that constitute a common man’s basket, which the Labour Bureau at Shimla reviews periodically. It is suggested that this should be made the basis for revision of that matrix periodically without waiting for another Pay Commission,” he said.
Mishra pointed out that while the DA for government employees and pensioners reached 50% on January 1, 2024, there has been no decision to restore the Pension under the CCS(Pension) Rules for those recruited after January 1, 2004.
He mentioned that over 20 lakh civilian central government employees contribute 10% of their basic pay and DA to the National Pension System (NPS) each month, which reduces their take-home pay.
Given these factors and current needs, Mishra emphasized that it is time to establish the 8th Central Pay Commission.
“Considering all the above aspects and today’s requirement of life and also to attract qualified and talented candidates to the Government service time has now come to immediately constitute the 8th Central Pay Commission and to revise the pay scales/allowances/pension and other benefits of the central government employees through mutual discussions and settlements. Therefore, the staff side demands that the government of India may immediately constitute the 8th Central Pay Commission,” said the letter.
He urged the government to start discussions and make settlements to revise the pay scales, allowances, pension, and other benefits for central government employees.