8th central pay commission: Hike in minimum pay, increment and DA — Here's how employee groups want salaries to change

The 8th central pay commission (CPC) is holding its second day of consultations with unions from the Ministries of Defence and Railways today, as it seeks to gather views and inputs from representatives and stakeholders before making its official recommendations.

Set up by Prime Minister Narendra Modi in November last year, it began processes in January, opened memorandum submissions held meetings in March and began meetings with employee representatives in April.

Constituted every 10 years, the panel is expected to make significant decisions impacting salaries of central government employees and pensioners. It has planned meetings with employee representatives in Delhi, Jammu and Kashmir, Ladakh and Telangana in May and April. In a notice last month, it added that separate meetings will also be scheduled in other states and Union Territories (UTs) in due course.

Salaries, increments: What are major unions' demands?

Three major employee representatives — the National Council - Joint Consultative Machinery (NC-JCM), the Maharashtra Old Pension Organisation, and the All India Defence Employees Federation (AIDEF) — have submitted detailed proposals to the 8th CPC broadly seeking substantial overhaul of salaries, pensions and allowances for central government employees and pensioners.

• Allowances — NC-JCM: Housing and utility-linked structured pay, Maharashtra Old Pension Organisation: Higher house rent allowance (HRA) and 2.5x TA increase, AIDEF: Risk allowance ( ₹10,000-15,000).
• Annual increment — NC-JCM: 6% (from 3%), Maharashtra Old Pension Organisation: 5% (from 3%), AIDEF: Improved progression-linked increments.
• Dearness Allowance / Inflation Handling — NC-JCM: Inflation-linked wage model, Maharashtra Old Pension Organisation: Minimum 4% DA hike + DA merger at 50%, AIDEF: Inflation-adjusted compensation demands.
• Minimum Basic Pay — All three have demanded hike in the minimum basic pay for central government employees. NC-JCM: ₹69,000, Maharashtra Old Pension Organisation: ₹65,000, AIDEF: ₹69,000.

• Pay Structure Reform — NC-JCM: Unified pay matrix up to Level 13, Maharashtra Old Pension Organisation: Rationalisation of pay levels, AIDEF: Cadre restructuring and skill-based pay.
• Pension Reform — NC-JCM: Structural alignment with revised pay, Maharashtra Old Pension Organisation: OPS restoration + UPS reforms + DA linkage, AIDEF: Pension parity with revised pay structure.

How will the 8th CPC make its decision?

Notably, feedback shared during these sessions is anticipated to significantly influence the design of future reforms concerning remuneration and pension structures for the central government workforce. The panel is expected to collect data and analyse it to decide allowances, pension formula and salary structures for employee and retiree groups.

The 8th CPC is chaired by former Supreme Court Judge, Justice Ranjana Prakash
Desai and includes Professor Pulak Ghosh, tenured Professor of Finance, Member of the Economic Advisory Council to the Prime Minister, as a Member of the Commission, besides Pankaj Jain as Member-Secretary.

Around 50 lakh central government employees and around 65 lakh retired central government pensioners (including defence and railway employees and retirees) are set to be impacted by the 8th CPC's decisions.

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