The 8th Pay Commission, when implemented, will potentially increase salaries of Central government employees by 25-30 per cent and pensions proportionately, industry experts said on Friday.
Since the last pay hike came into effect from January 1, 2016, the next salary should be revised from January 1, 2026 as the hike in salary of Central government staff takes place after 10 years.
The 8th Pay Commission is pivotal in addressing evolving economic realities and ensuring government salaries and pensions remain competitive.
The move is expected to benefit around 50 lakh Central government employees, including defence personnel, along with more than 65 lakh pensioners, according to officials.
Historically, the 7th Pay Commission introduced a fitment factor of 2.57, leading to an average salary hike of 23.55 per cent and aligning pensions with the ‘One Rank, One Pension’ scheme. Before that, the 6th Pay Commission applied a factor of 1.86.
“For the 8th Pay Commission, a fitment factor between 2.6 and 2.85 is speculated, potentially increasing salaries by 25-30 per cent and pensions proportionately,” said Neeti Sharma, CEO, TeamLease Digital.
The basic minimum is expected to rise beyond Rs 40,000, along with perks, allowances and performance pay.
“Such revisions are crucial to counter inflation, rising living costs, and the widening gap between public and private sector remuneration. Beyond financial benefits, the revised pay scales will also enhance disposable incomes, stimulating consumption and contributing positively to the economy,” Sharma informed.
Periodic revisions reflect the government’s commitment to a fair and equitable system that values its workforce and ensures they are financially empowered.
The Cabinet on Thursday approved the formation of the 8th Pay Commission, which will take up the issue of increasing salaries of Central government employees and payments to pensioners.
Since 1947, seven pay commissions have been formed. The 7th Pay Commission came into effect in 2016. Its tenure will conclude in 2026.
By deciding to form the 8th Pay Commission in 2025, we have sufficient time to receive recommendations well before the completion of the period of 7th Pay Commission, according to the government.
The process will involve wide consultations with state governments, the Central government, PSUs and different stakeholders. A chairman and two members will also soon be appointed for the commission.
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