The Narendra Modi government has started looking into an alternative for increasing salaries and allowances of Central government employees and pensioners in future instead of forming 8th Pay Commission. Earlier in December, there were reports that the 7th Pay Commission was the last Pay Commission and in future, the Centre will look into the pay hike of its employees every year.

Several media reports suggested that the Finance Ministry has confirmed that no new Pay Commission would be formed to increase salaries and allowances of the Central government employees.

The government is likely to follow the instructions of the 7th Pay Commission headed by Justice AK Mathur who earlier said that the Central government employees’ salary must be revised every ear taking into account the available data and price index.

The 7th Pay Commission further recommended that reviewing the pay matrix periodically instead of waiting for 10 long years to revise the salary and allowances.

The commission also suggested the use of Aykrod formula for the hike in minimum pay of the Central government employees. The Aykroyd formula is attributed to Dr Aykroyd who worked on nutrition for nearly 30 years and was the director of Food and Agriculture Organisations, United Nations.

The Aykroyd formula also takes into account the three basic needs of a human being while considering pay hike and salary structure.

Earlier this month, Minister of State for Finance P Radhakrishnan had made a statement in Lok Sabha that no formation of Pay Commission in future is not on government radar for the time being and this will be declared later by Finance Minister Arun Jaitley.

A 23.55 per cent hike was proposed by Justice AK Mathur committee for government employees in the 7th Pay Commission report tabled before the Finance Minister in 2015.