Demand for 8th Central Pay Commission: Confederation Makes a Strong Appeal to PM

The Confederation of Central Government Employees and Workers, representing over 7 lakh Central Government employees across various departments, has submitted a formal request to the Prime Minister on December 11, 2024, urging the immediate constitution of the 8th Central Pay Commission (CPC)​.

The Confederation emphasized the critical need for a wage revision, citing factors like rising inflation, erosion of real wages, post-pandemic economic challenges, and the increasing cost of living. The request, accompanied by a detailed note, underlines the necessity for timely intervention to address employee welfare and ensure effective governance.

Key Highlights of the Confederation’s Letter

1. Long Gap Since the Last Revision
   • The 7th Central Pay Commission implemented wage revisions effective January 1, 2016.
   • As of July 1, 2024, the Dearness Allowance (DA) entitlement has crossed 53%, highlighting the steep rise in inflation over the last nine years​.
   • Despite growing economic challenges, employees have had to endure a 10-year wage revision cycle.
2. Significant Erosion of Real Wages
   • The COVID-19 pandemic exacerbated the economic strain, with prices of both essential and non-essential commodities surging sharply.
   • High inflation rates, averaging 5.5%, have reduced the purchasing power of salaries, leaving employees struggling to maintain a decent standard of living​.
3. Comparisons with Other Sectors
   • Public Sector Units (PSUs) and bank employees receive wage revisions every five years.
   • Central Government employees, however, face a 10-year cycle, which is increasingly unsustainable given the economic pressures​.
4. Doubling of Household Expenditure
   • According to NSSO data, per capita monthly household consumption expenditure has more than doubled from 2011-12 to 2022-23, driven by inflation and rising living costs​.
   • While expenses have soared, wage growth has not kept pace, leading to financial stress for employees and pensioners.
5. India’s Growing Economic Strength
   • The Confederation noted that India is poised to become the third-largest economy globally by 2027, surpassing Japan and Germany, with GDP projected to exceed $5 trillion​.
   • Given this strong economic outlook, the government is well-positioned to ensure fair and timely wage revisions.
6. Social Responsibility of the Government
   • As a model employer, the Government of India has a duty to provide a comfortable living standard for its workforce.
   • Employees play a pivotal role in implementing government programs and policies, ensuring benefits reach the common man.
7. Importance of Attracting Talent
   • A competitive pay structure is essential to attract and retain the best talent in government service.
   • The Confederation stressed that talented employees are crucial for delivering good leadership and effective governance​.

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Key Insights from the Detailed Note

The detailed note enclosed with the Confederation’s letter further expanded on the economic and social arguments:

1. Impact of Inflation on Wages
   • Over the past decade, inflation has steadily eroded the real value of wages, disproportionately impacting employees and pensioners.
   • Employees now struggle to maintain basic living standards, with rising prices of goods, services, and housing adding to their burden.
2. Wage Parity with PSUs and Banks
   • The Confederation highlighted that wage revisions in PSUs and banks occur every five years to align with inflation.
   • Central Government employees, however, are subject to a 10-year wage revision cycle, which fails to address economic realities​.
3. Living Wages and Economic Responsibility
   • The Confederation emphasized that employees deserve a living wage that reflects the current economic conditions.
   • A revised pay structure would not only improve living standards but also boost morale and productivity.
4. Employee Expectations and Trust
   • Citing observations from the Supreme Court, the Confederation reminded the government that employees’ legitimate aspirations must not be disregarded.
   • A fair and timely wage revision fosters trust and ensures that employees feel valued​.
5. The Role of Central Government Employees
   • Employees form the backbone of the government, implementing policies and delivering services to the public.
   • Ensuring their financial well-being is critical for achieving good governance and effective policy execution.

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Confederation’s Call for Immediate Action

The Confederation concluded its plea with a clear demand:

• Constitute the 8th Central Pay Commission without further delay to address the wage erosion caused by inflation and rising costs.
• Act swiftly to ensure Central Government employees and pensioners receive fair compensation and are empowered to work effectively​.

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India’s Economic Context and Paying Capacity

The note also pointed to India’s strong economic performance, highlighting:

• IMF projections indicating India’s ascent to the world’s third-largest economy.
• The government’s paying capacity is more than adequate to meet employee expectations, especially in light of economic growth​.

View the Confederation’s letter: