Centre urged to form Eighth Pay Commission amidst rising costs and employee demands

Centre urged to form Eighth Pay Commission amidst rising costs and employee demands

A trader counts Indian Rupee notes at a Mumbai shop.

The Centre has received a formal proposal urging the formation of the Eighth Pay Commission as soon as possible to meet the urgent requirements of central government employees and pensioners. Shiv Gopal Mishra, Secretary of the National Council (staff side, Joint Consultive Machinery), forwarded the recommendation to the Cabinet Secretary in a letter stressing the need to revise basic salary, allowances, pensions, and other benefits givencurrent economic realities.

Proposal for the Eighth Pay Commission

Mishra stated that the last pay commission, the Seventh Pay Commission, was implemented in 2016, with its recommendations taking effect on January 1 of that year. Given the normal decade-long delay between pay commissions, Mishra claimed that the time has come to form the Eighth Central Pay Commission, which will take effect on January 1, 2026.

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Economic justification and demand for revision

Mishra used economic data to show that inflation rates have greatly surpassed increases in Dearness Allowance (DA) paid to employees and pensioners. He pointed out that critical commodity prices have climbed by more than 80 per cent since 2016, whereas DA adjustments have only reached about 46 per cent as of July 1, 2023. Mishra additionally highlighted the significant improvement in government revenue, with GST and income tax revenues showing strong gains in recent fiscal years.

Opposition and government stance

Despite rising pressures and economic arguments offered by Mishra, the government has yet to make an official declaration on the formation of the Eighth Central Pay Commission. The hesitancy has sparked frustration among more than 1 crore federal government employees who are eagerly anticipating developments after the 2024 Lok Sabha elections.

Prospects and Employee Expectations

Mishra closed the letter by urging for a more frequent review of the pay matrix, with updates based on the Aykroyd formula to better reflect changes in living costs. He also expressed reservations about the National Pension System (NPS), stating that employees should return to pre-2004 pension norms. With worker challenges compounded by a high vacancy rate and greater workload, the call for fast action on the pay commission has grown stronger.

(With inputs from Agencies)