7th Pay Commission News: In what comes as a significant news development for central government employeesthe Union Government has recently clarified that it is not considering any proposal for the constitution of the 8th Pay Commission. “No such proposal is under consideration with the Government for constitution of 8th Central Pay Commission for the Central Government employees,” Union Minister of State for Finance Pankaj Chaudhary said in Rajya Sabha.
Deepak Baij, the Congress MP from Chhattisgarh’s Bastar and Bharatiya Janata Party (BJP) MP Janardan Singh Sigriwal in an unstarred question asked the Centre if it proposes to ensure the timely constitution of the 8th pay commission for central government employees so that it could be implemented in 2026.
While addressing the house, Pankaj said that the Chairman of the 7th Pay Commission had “recommended that the matrix may be reviewed periodically without waiting for the long period of ten years.”
He further said, “It (pay matrix) can be reviewed and revised on the basis of the Aykroyd formula which takes into consideration the changes in prices of the commodities that constitute a common man’s basket, which the Labour Bureau at Shimla reviews periodically. It is suggested that this should be made the basis for revision of that matrix periodically without waiting for another Pay Commission.”
“ln order to compensate Central Government employees for erosion in the real value of their salaries on account of inflation, Dearness Allowances (DA) is paid to them and the rate of DA is revised periodically every 6 months on the basis of the rate of inflation as per All India Consumer Price lndex for Industrial Workers (AlCPl-lW) released by Labour Bureau under M/o Labour & Employment,” Chaudhary said.
The DA is revised based on the changes in the All India Consumer Price Index (AICPI). Now, as the AICPI is prevailing high, the chances of government employees getting a raise in dearness allowance is also high. The retail inflation in May stood at 7.04 per cent, which is above the RBI’s target level of 2-6 per cent.
However, on another query, whether the government will increase the Dearness Allowance and Dearness Relief rates in view of the high WPI inflation, Pankaj responded by saying that it was not necessary as DA/DR is based on AICPI-IW data provided by the Labour Bureau at Shimla.
It must be noted that Dearness Allowance varies from employee to employee based on whether they work in urban sector, semi-urban sector or the rural sector.
The union government had raised the dearness allowance by three per cent to 34 per cent on March 31, 2022 for 47.7 lakh central government employees, and a hike in dearness relief was also announced for 68.6 lakh pensioners to provide some relief from inflation.
The government set up the 7th Pay Commission on February 28, 2014. The recommendations of the panel were effective from January 1, 2016.
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