Eighth Pay Commission is expected to continue building on the existing pay structure and make further changes to improve transparency and address issues that may arise. The new commission may look into the pay matrix and make necessary revisions to ensure that it continues to provide complete transparency regarding pay progression. The commission may also assess the impact of the new pay structure on the government’s ability to attract and retain the best available talent in government services and make necessary adjustments to improve the competitiveness of government pay.
The Seventh Central Pay Commission (CPC) proposed a new pay model to address existing issues and establish a transparent and simple system and that the existing system of Pay Bands and Grade Pay has been dispensed with, and a new functional level system has been proposed by merging the grade pay with the pay in the pay band. The new pay structure has been designed in the form of a pay matrix to provide complete transparency regarding pay progression. The nomenclature being used in the new pay matrix assigns levels in place of erstwhile grade pay, and the new dispensation for various grades pay pertaining to Civil, Defence, and MNS has been provided.
Pay Structure (Civilian Employees)
The objective of all prior Pay Commissions has been to propose a pay structure reform through “simplification and rationalization.” The most noticeable outcomes of this initiative are the reduction in the number of pay grades and the compression ratio.
Historically, the compression ratio has been calculated as the ratio between the maximum compensation of the Secretary to the Government of India and the minimum salary of the lowest government functionary.
The following table illustrates the evolution of the Indian government’s pay structure over the years:
The 7th Pay Commission built the new pay matrix with the huge opportunities that have opened up outside of government over the past three decades in mind, resulting in increased competition for human resources and the need to attract and retain the finest talent available in government services. The nomenclature used in the new pay matrix assigns levels in place of grade pay, as shown in Table 3 below. This table outlines the new provisions for varied grade pay in the Civil, Defense, and MNS sectors.
