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New Delhi. There is a lot of enthusiasm among central employees and pensioners regarding the 8th Pay Commission. Employee unions have placed many big demands before the government to improve their economic condition. But, according to a senior union representative, it will not be easy for the government to completely accept all these demands. The government has to strike a balance between the welfare of the employees as well as the country’s budget, fiscal pressures and long-term liabilities. Let us understand in simple language what is the whole matter.

One of the most prominent demands of the employees is the approval of 3.83 fitment factor. Fitment factor is the formula by which the basic pay and pension of employees is decided. The higher it is, the bigger will be the increase in salary and allowances. The union argues that due to rising inflation the real value of salaries has reduced, hence this increase is necessary.

According to the union representative, the government may hesitate in accepting this demand completely. The responsibility of the government is not limited to just the central employees. Whenever the central government increases the salary, it impacts the country’s economy, budgets of various departments and also the state governments, because the state governments also increase the salaries of their employees on the same lines. To avoid such a huge financial burden, the government can find a middle path (Moderate Formula).

At present, while fixing the minimum wage, the government follows the formula of a family of 3 members (husband, wife and a child). But, the unions demand that it should be increased to a family of 5 members. The union says that in today’s time, employees not only take care of their wives and children, but also take care of their elderly parents. The cost of health, education and housing is continuously increasing. This demand is not only to increasing the salary, but is to today’s social and economic reality, hence the government’s stance on this can be positive.

The biggest controversy is regarding the Old Pension Scheme (OPS). Employees’ organizations are demanding restoration of the old pension system by removing the National Pension System (NPS), because in OPS, after retirement, 50% of the last basic salary and dearness allowance (DA) are secured as pension.

Ground reality:- The union representative admitted in a subdued tone that it is not easy to abolish NPS completely after so many years, because a huge amount of money from the government and employees is invested in it.

Middle Path:- Now many unions are demanding OPS-like security like Guaranteed Pension Security, DA-linked Pension Protection and Minimum Assured Pension, leaving aside the insistence of removing only NPS.

Economists believe that a huge increase in salaries and pensions puts huge pressure on the country’s treasury, due to which there is a danger of inflation increasing. The government also has to fulfill the expectations of the employees and also keep the country’s financial deficit under control.

The Pay Commission is visiting different parts of the country and meeting organizations. In the coming time, a big meeting is going to be held in Lucknow on 22nd and 23rd June. It is clear that the final recommendations of the 8th Pay Commission will depend not only on the demands of the employees, but on how much expenditure the government is able to bear in the long run.