7th Pay Commission: Nirmala Sitharaman Urged To Form 8th CPC As DA Rates May Go Over 50% Next Year

7th Pay Commission : The Railway Senior Citizens Welfare Society has issued reasons why the government should set up the 8th pay commission.

7th Pay Commission: The Railway Senior Citizens Welfare Society (RSCWS) has urged Finance Minister Nirmala Sitharaman to establish the 8th Pay Commission as of January 1, 2024, as the rates of Dearness Allowance (DA) and Dearness Relief (DR) are anticipated to increase by more than 50 per cent in 2019.

Moreover, the RSCWS also issued reasons why the government should set up the 8th pay commission. The Railway Senior Citizens Welfare Society said that the 7th Pay Commission had fixed the minimum pay at Rs 18,000 in place of Rs 26,000 and “erroneously proposed” the fitment factor at 2.57 instead of 3.15.

Demands Of RSCWS

“As per the recommendations of the last three Central Pay Commissions, the future pay revision should be done when the DA/DR reaches 50% or more than the basic pay; the pay structure needs revision to neutralise the impact of inflation. The rate of DA/DR is projected to cross 50% or even more from January 2024, and as such, the pay and allowances and pension need to be revised accordingly from January 2024,” the memorandum issued by the RSCWS said.

The memorandum also said, “This was a great injustice to the Central Government employees and pensioners, caused by the continuous erosion of their real income; the Dearness Allowances and Dearness Reliefs do not provide the requisite relief against inflation, nor do they provide the required element to keep pace with the rise in per capita income of the country.”

The RSCWS also claimed that India’s per capita income has increased by more than twofold from Rs 93,293 in 2015-16 to Rs 1,97,000 in 2022–23 (as interpolated at current prices), as stated in the Budget Speech of the MOF for the year 2023–24. However, according to the data indicated above, between January 1, 2016, and January 1, 2023, the pay and pension of central government employees increased by just 42%. In contrast, over this same period, the per capita income of the country had climbed by 111%, as quoted in the Financial Express.

Government’s Reaction:

There has been no update from the central government on this issue since then, but last year, the central government said there might not be a need to set up another pay commission.

What Is The Fitment Factor?

The fitment factor is a numerical statistic that is critical in the process of converting an employee’s or pensioner’s previous wage to the new basic salary.

For example, if a person receives a basic salary of Rs 15,500 in the 4200 Grade Compensation, his total compensation will be Rs 15,500 x 2.57, or Rs 39,835 as per a report in the News18.