To be implemented by the upcoming 8th Pay Commission, central government employees will soon be enjoying a radical salary hike opportunity. At this juncture, the lowest basic salary to be expected is ₹26,000, compared to the present ₹18,000. Over 50 lakh government employees in different ministries who stand to gain will begin receiving a very substantially agreed-upon amount throughout the applicable channels.
Roots of the Salary Revision
This salary revision has come by with benefits to the government for dealing with inflation and the cost of living. After the implementation of the 7th pay panel, employees have voiced loud and clear about a higher fitment factor for better take-home pay. Apparently, the employees’ demand for salary revision comes with inflation catching up with the cost of necessities.
The salary rise is another view of the political angle under the Lok Sabha election. Evidently, government undertook these salary increments before elections so as to ensure the support of government employees and families.
Impact of the Higher Fitment Factor
One of the reasons for a jump in remuneration has also been the altered fitment factor, which is expected to grow from 2.57 to 3.68. It is the fitment factor that decides how much the basic salary will apparently be raised with the new commission. The central government employee falls in for a basic pay of ₹18,000 every month under the 7th Pay Panel. So, if a 3.68 fitment factor gets accepted after all, the new minimum basic salary becomes ₹26,000 per month.
Now, for an employee earning ₹18,000 as the main pay, the following calculations would apply:
₹18,000 × 3.68 = ₹66,240 (inclusive of allowances like DA, HRA, and TA).
That salary increase will certainly not only uplift the financial condition of employees but will also uplift consumer spending in the economy overall.
Effect on Allowances and Pension
This revised salary will indeed increase the basic salary and should also increase other things like dearness allowance (DA), house rent allowance (HRA), and travel allowance (TA). However, inflation allows dearness allowance to be refigured twice yearly. Therefore, the significant part of their monthly benefits has worked very high against the denominator of their basic pay in the past. Now, the higher the basic salary gets, the greater are the benefits the employees get because of dearness allowances, thereby squeezing them a bit more money every month.
Pensioners would fetch no less benefit from the proposed revision since it would be their last salary which the pension is pegged against. Hence, increasing the basic pay leads to less retirement benefits, thus contributing to everyone’s better-financial-security retirement social system.
Implementation Timeline
In the absence of the official final decision of the salary increment, speculated implementation should culminate as a part of the 8th Pay Commission. Expected to implement the same from the 2024 general elections. The implementation of the proposed hike also forms part of politically generated debate. Should the implementation begin anytime soon, the elections are bound to fall in 2024.
Conclusion
No doubt, the elevation from ₹18,000 to ₹26,000 Basic with fitment factors and enhanced allowances spells unassuming financial succor to the government employees. This will lead them to earn a respectable increase in monthly salaries, higher than what the anachronistic 7th brought them. There is a ray of hope with the revision for the employees and pensioners themselves and, in so doing, arm the economic gears through better disposable income. When carried through, this speculation-variating issue makes employees wait with bated breath for the marked pronunciations.