The Prime Minister Narendra Modi-led union cabinet approved the formation of the 8th Central Pay Commission (CPC) last month to revise the salaries of nearly 50 lakh central government employees and allowances for 65 lakh pensioners. Although the government is yet to appoint the chairman and two members of the CPC, the terms of reference (ToR) for the Commission are expected to be finalized by April 2025. The National Council – Joint Consultative Mechanism (NC-JCM), which resolves disputes between the central government and employees, has already submitted proposed ToRs. Secretary Shiv Gopal Mishra has requested a meeting to formally discuss these proposals.
8th Pay Commission: Focus on Pay Revisions, MACP Reform, and Family Unit Adjustments
The key areas of focus for the 8th Pay Commission include revising pay and allowances, restructuring the Modified Assured Career Progression (MACP) scheme, and considering interim relief for employees until the new pay structure is implemented. The MACP reform could allow employees up to five promotions during their career, addressing long-standing concerns regarding career progression.
There is also a push to include Dearness Allowance (DA) in the Basic Pay, which has been a long-standing demand of employees. Moreover, Mishra has suggested considering a minimum salary based on five family units instead of three. This adjustment would recognize the responsibility of central government employees in caring for elderly parents under the Maintenance and Welfare of Parents and Senior Citizens Act 2022.
Updating Aykroyd Formula and Expected Salary Hike in 8th Pay Commission
Another significant consideration is updating the Aykroyd formula, which is based on the 20th-century cost of living. Mishra pointed out that this formula does not account for modern-day expenses, such as the costs associated with digitalization and internet access.
As for the salary hike, reports indicate that the fitment factor could rise from 2.57 to 2.86, potentially increasing the basic pay in Level 1 from Rs 18,000 to Rs 51,480, leading to a revision of salaries and pensions across all levels.
