8th Pay Commission: New proposal for immediate increase in basic salary and DA of central employees

The government’s earnings are also increasing with inflation. In such a situation, the demand for the 8th Pay Commission for more than 1 crore central government employees has intensified. Employees want their salaries, allowances and pensions to be reviewed.

Shiv Gopal Mishra, Secretary, National Council (Staff Side, Joint Consultative Machinery for Central Government Employees), has urged the government to constitute the 8th Pay Commission (CPC) as soon as possible. He has said that both government earnings and inflation have increased significantly since the Corona epidemic. Due to this, the gap between dearness allowance (DA) and rising prices of essential commodities is increasing. He stressed that the last salary revision took place in 2016. Since then, inflation has significantly reduced the purchasing power of employees and pensioners.

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What is a Pay Commission?

The Pay Commission is a body appointed by the government. It reviews the salary structure, allowances and benefits of central government employees. Then recommends changes in them. Usually this commission meets every 10 years. This commission assesses factors like inflation. On February 28, 2014, the then Prime Minister Manmohan Singh constituted the 7th Pay Commission. This commission submitted its report on November 19, 2015. Its recommendations were implemented from January 1, 2016.

When will the 8th Pay Commission be formed?

Now all eyes are on the 8th Pay Commission. It is estimated that it will be formed by January 1, 2026. This will happen 10 years after the previous commission. There has been no official announcement from the Center yet. But, with the Modi government coming to power for the third time after the 2024 Lok Sabha elections, more than 1 crore central employees are very curious about the Eighth Pay Commission.

What is the new proposal?

According to a report by our partner Economic Times, Shiv Gopal Mishra, in a letter to the Cabinet Secretary, has stressed the urgent need for a new pay commission to address these economic realities. He said that government revenue has doubled since 2015. Tax collection has also increased significantly. But, the salaries of central government employees have not increased according to inflation.

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Mishra said, ‘According to the budget data, the revenue of the central government has doubled from the year 2015 to 2023. We can see that the revenue collection has increased significantly. The actual revenue of the central government has increased by more than 100%. Therefore, the central government has more capacity to pay as compared to the year 2016. GST collection has also increased to Rs 1.87 lakh crore in April 2023. Income tax collection has been the highest in the year 2022-23. Gross personal income tax collection (including STT) (provisional) in the financial year 2022-23 is Rs 9,60,764 crore. This shows an increase of 24.23% compared to the previous year.’

The number of central government employees has decreased by about 10 lakh in the last decade. This has increased the workload on existing employees. The letter also recommends periodic review of the pay matrix. It says that one should not wait for a full 10 years for this. The recommendation proposes the Akroyd formula as a standard. This formula takes into account the changing prices of essential commodities. It provides a more dynamic approach to salary adjustment.

The challenges of NPS are also mentioned

Apart from this, Mishra also highlighted challenges like National Pension System (NPS). Under this, 10% of the basic salary and DA of the employees is deducted. This reduces their salary in hand. Despite the demands to restore the old pension scheme for employees recruited after 2004, the government has not yet agreed.

The letter said, ‘The government has neither accepted the above recommendations nor constituted the 8th Pay Commission. The DA of central government employees and pensioners has already reached 50% from 1.1.2024. Considering inflation and price rise, the DA component will cross 50%. It is also worth mentioning here that more than 20 lakh civilian central government employees are covered under the National Pension System.

They have to contribute 10% of their basic pay and DA to NPS every month. This significantly reduces their in-hand salary. The government has not yet agreed to our demand to abolish NPS and restore pension under CCS (Pension) Rules, 1972 (now 2021) for central government employees recruited on or after 1.1.2004.’

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