The Indian government has no plans to establish the eighth Pay Commission, which would have affected the salaries of over 5.4 million central government employees and pensioners. Finance Secretary TV Somanathan stated that there is currently no need for the eighth Pay Commission.
Previous Use of Pay Commissions as Political Tools
In the past, governments have used the establishment or implementation of Pay Commissions as a strategy to gain favor with central government employees, armed forces personnel, and family pensioners, particularly during election periods. For instance, the Congress-led UPA government formed the 7th Pay Commission in September 2013, just months before state and general elections.
BJP’s Focus on New Pension Scheme Review
The BJP, on the other hand, has decided to focus on reviewing the new pension scheme, which has caused discontent among new state and central government employees. Under the current scheme, employees contribute 10% of their basic salary, while the government contributes 14%. This scheme has sparked political controversy, with several opposition-ruled states reverting to the old pension scheme, which guarantees pensioners 50% of their last drawn salary monthly without any employee contribution.
Government Committee Reviewing New Pension Scheme
The government has formed a committee led by the Finance Secretary to examine the new pension scheme. Somanathan stated that consultations with all stakeholders have been completed and that the committee’s report will be submitted soon.
The government may make changes to guarantee that employees receive at least 40 to 45 percent of their last salary as pension.
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