Salary Hike Update: Lakhs of central employees and pensioners across the country are eagerly waiting for the formation of the Eighth Pay Commission. Although this commission has not been formally constituted yet, but according to the information received from government circles, some important announcement may be made in this direction soon. This news is a matter of relief for all those employees who have been facing the brunt of inflation for some time and are hoping for improvement in their financial condition.
Currently, there are about 1.3 crore central employees and pensioners in the country who will benefit from this new pay structure. It has been a long time since the recommendations of the Seventh Pay Commission were implemented, and now the time has come to consider the new pay system. Employees working in various departments of the Central Government are curious about how much the new pay commission will add to their monthly income.
Importance of Fitment Factor
The most important point in the Eighth Pay Commission is the fitment factor, which determines the amount of salary hike. According to experts’ estimates, this factor can range from 1.92 times to 2.86 times. This ratio depends on many factors, mainly inflation rate, allocation in the government budget, and merger of dearness allowance. The higher the fitment factor, the higher will be the increase in the salary of the employees.
While determining this factor, the government has to consider many aspects. The final decision is taken only after assessing the economic situation, fiscal policy, and the actual needs of the employees. Looking at the experience of previous pay commissions, it can be said that the government will select the appropriate fitment factor keeping in mind the interests of the employees.
Different scenarios of salary calculation
Suppose the basic salary of an employee is Rs 22,400. If the 1.92 times fitment factor is adopted in the Eighth Pay Commission, then his new basic salary will become Rs 42,908. This is an increase of about Rs 20,000 which can be quite satisfactory for any employee. In this case, the employee will get additional income throughout the month which will help in improving his lifestyle.
In the second scenario, if the fitment factor is kept at 2.0 times, then the basic salary of the same employee will become Rs 44,800. This is slightly better than the first option and will prove to be more beneficial for the employees. In the third and most attractive option, if 2.86 times fitment factor is applied, then the basic salary will increase to Rs 64,064. This is almost equal to double the salary and will be the best scenario for the employees.
Comparison with 7th Pay Commission
The Seventh Pay Commission used a fitment factor of 2.57 times, which increased the minimum basic salary from Rs 7,000 to Rs 18,000. This was a big relief for the employees at that time and their financial condition improved significantly. Similar expectations are being made from the Eighth Pay Commission that it will bring radical changes in the salary structure of employees.
Looking at the current circumstances, experts believe that the new fitment factor may be better than the Seventh Pay Commission. Keeping in mind the increase in the rate of inflation and the rising cost of living, the government may have to adopt a more liberal stance. This will give real benefits to the employees and their standard of living will improve.
Dearness Allowance issue
An important question is what will happen to the 55 percent dearness allowance currently being given in the Eighth Pay Commission. If it is merged with the basic salary before applying the fitment factor, then the final salary hike may be less than expected. On the contrary, if the dearness allowance is kept separate then the employees can get more benefits.
The government’s policy will be very important in this matter. Based on past experiences, it has been seen that there is always confusion regarding dearness allowance during the pay commission. Employee organizations want that the fitment factor should be implemented without merging dearness allowance with the basic salary so that they can get maximum benefit.
Disclaimer
This article is written for general information purpose only. There has been no official announcement yet regarding the formation of the Eighth Pay Commission and its recommendations. The information given regarding the salary hike is approximate and the actual situation may differ from it. Employees are advised to confirm the information from official sources.
