8th Pay Commission

The Union government has approved the setting up of the 8th Pay Commission, and its Chairman and members will be appointed soon. 

The Union government announced the constitution of the 8th Pay Commission to revise the salaries of nearly 50 lakh central government employees and allowances of 65 lakh pensioners. Union minister Ashwini Vaishnaw said the decision to set up the Commission was taken at a meeting of the Cabinet chaired by Prime Minister Narendra Modi.

A Pay Commission, set up by the government of India, decides the salary and compensation of Central government staffers and allowances of pensioners. The 8th Pay Commission will recommend revisions in the salary and pension structure of the beneficiaries, resulting in a hike in the remuneration and allowances.

Pay commissions consult with central and state governments, along with other stakeholders, before recommending salary structures, benefits, and allowances for government employees. Their recommendations are often adopted by state-owned organisations.

The implementation of the pay commission’s recommendations results in increased consumption and economic growth, with an improved quality of life for government employees. Generally, every 10 years, the central government implements a pay commission to revise employee remuneration.

The commission also suggests formulas for revising dearness allowance and dearness relief for central government employees and pensioners, aiming to offset the impact of inflation. The recommendations are suggestive, there is no obligation on the government to accept the recommendations of the pay commission.

Since 1947, seven Pay Commissions have been constituted, with the last one constituted in 2014 and implemented on January 1, 2016. The 7th pay commission saw an expenditure increase of Rs 1 lakh crore for fiscal 2016-17. The chairman of the 7th Pay Commission is Justice Ashok Kumar Mathur.

There are over 49 lakh central government employees and nearly 65 lakh pensioners who will benefit from the salary hike. As the 7th Pay Commission’s term concludes in 2026, initiating the process now ensures sufficient time to receive and review recommendations before its completion, Vaishnaw said. He further said the setting up of the new Pay Commission in 2025 will ensure that its recommendations are received well before the completion of the term of the seventh pay panel.