The 8th Pay Commission is in a critical consultation stage as employee unions proposed notable changes in salaries, pension benefits, allowances and promotion systems for central government employees and pensioners.
The Commission has received detailed proposals from three major organisations – the National Council Joint Consultative Machinery (NCJCM), Maharashtra Old Pension Organisation and the All India Defence Employees Federation (AIDEF).
Although their priorities vary, they have all broadly agreed that there is one big issue to be addressed: the existing pay structure must be significantly changed to reflect the increasing costs of living and inflation.
The Commission is anticipated to finalize its recommendations by mid-2027.
A major demand is for a significant increase in minimum basic pay.
According to the proposals, NCJCM and AIDEF have called for a revised minimum salary of Rs. 69,000 and by the Maharashtra Old Pension Organisation, it's been put at Rs. 65,000. The current basic pay of the 7th Pay Commission is Rs. 18000.
mployee organisations have also recommended a fitment factor of 3.8 to 3.833 as compared to the current factor of 2.57. The fitment factor is an important determinant of salary, pension and allowances changes.
Unions are also calling for an annual raise of 5-6%, a move that would replace the current 3% increment system. Pension Reforms and OPS Restoration get the attention.
The Maharashtra Old Pension Organisation (MOPO) has strongly called for the revocation of the Old Pension Scheme (OPS) and linkage with Dearness Allowance (DA) and pension revision. As inflation and healthcare costs go up, employees feel they need more secure retirement benefits, employee representatives say.
The Staff Side also made proposals for pension parity with the new pay scales, for pension revision every five years, for the enhancement of family pension benefits and for increased pension gratuity limits.
One of the key proposals is Rs. 2 crore ex gratia compensation in the event of an accidental death while in service.
In addition to salary adjustments, unions are asking for significant raises in allowances as well as changes to career advancement plans.
In an earlier memorandum to the Commission, workers have asked for:
An increase of threefold on the HRA, transport allowance and Children Education Allowance (CEA)
Defence civilians and technical staff are eligible for risk allowance ranging from Rs. 10,000 to Rs. 15,000
Five promotions granted in 30 years of service
Additional two increments will be added to the promotion
Simplified pay matrix and cadre restructuring were implemented
Particularly, AIDEF has been concentrating on reforms of technical cadre and promotion of defence civilians at an early stage.
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Labour unions have been backing these costs based on the high inflation, high housing, high health care and high education costs in the past 10 years.
Union officials say the current pay structure is not adequate to keep up with the cost of living, particularly in high-density areas.
Justice Ranjana Prakash Desai is the chairperson of the 8th Pay Commission, which formally opened consultations in April. The Commission has also extended the closing date for the receipt of memoranda and suggestions that may be submitted until May 31, 2026.
The Commission's final recommendations are likely to have a notable impact on government salaries, pensions and allowances over the next decade.