8th Pay Commission Salary Hike: The upcoming 8th Pay Commission is a much-awaited benefit for lakhs of central and state government employees including pensioners. Why? Because the 8th CPC will increase the pay matrix, along with perks of allowances. However, the quantum of salary hike depends upon the fitment factor which is debated heavily among experts and has mixed opinion. The staff side of the National Council-JCM has made various recommendations for the 8CPC, one of which is the fitment and merging of the pay matrix or dearness allowance with basic pay. The final decision will be on PM Modi-led government.

8th Pay Commission Government Employees Salary Hike:

The staff side of the National Council-JCM believes that the fitment factor should be at least 2 under 8CPC. Many reports have stated that experts are predicting a 1.92 2.08 or 2.86 fitment factor.

If either of the fitment factors of 2, or 2.08 or 2.86 gets the government’s approval, then central government employees’ salaries will increase by 100% or more. The same will be the case with pensioners as well!

Currently, under the 7th Pay Commission, the fitment factor for employees and pensioners is 2.57. While the minimum basic pay is Rs 18,000 for government employees and Rs 9,000 for pensioners.

At a predicted fitment factor of 2, the minimum basic pay and pension would double by 100% to Rs 36,000 and Rs 18,000 respectively.

But if a fitment factor of 2.08 is approved then the minimum basic pay would rise by 108% to Rs 37,440 from Rs 18,000. Pensions would also surge by 108% to Rs 18,720 from Rs 9,000.

The cherries on top would be a fitment factor of 2.86 if approved. Because then, the central government employees salary would rise by 186% to Rs 51,480 from Rs 18,000. The pension would skyrocket by 186% as well to Rs 25,740 from Rs 9,000.

When will the 8th Pay Commission be implemented?

The expected date for the implementation of the 8th Pay Commission is January 1, 2026. This is because, in India, pay commissions have taken effect each decade since its independence. Every 10 years, a committee is set up to review and provide recommendations on the work and pay structure of all the civil and defence division employees under the ambit of the Government of India. The pay commission is meant to improve the living cost of employees and pensioners, and beat inflation.

Prime Minister Narendra Modi approved the implementation 8th Pay Commission on January 16, 2025. Set up in May 1947, the government of India has implemented about seven pay commissions. The latest 7th Pay Commission came into effect on January 1, 2016, where about a 23.55% increase was levied on pay and allowances.

Hence, a decade later from the 7th Pay Commission, the 8th CPC is expected to be implemented on January 1, 2026.

Here are key focus areas in the 8th Pay Commission, as per the ClearTax report:

1. Restructuring of Pay and Allowances: The 8th Pay Commission is set to review and revise the salary structure of all central government employees. Additionally, if approved, proposed reforms in the Modified Assured Career Progression (MACP) scheme aim to provide at least five promotions throughout an employee’s career.

2. Dearness Allowance (DA) and Interim Relief: There has been a long-standing demand to merge Dearness Allowance (DA) with Basic Pay. Furthermore, central government employees are advocating for interim financial relief until the implementation of the new Pay Commission.

3. Expected Salary Hike: Central government employees are currently paid according to the 7th Pay Commission, which was implemented in 2016. The revised salaries under the 8th Pay Commission will be determined by the ‘fitment factor’-a multiplier applied to the current basic pay. Reports indicate that this factor may increase from 2.57 to 2.86, potentially raising the minimum basic pay in Level 1 from Rs 18,000 to Rs 51,480. Employees across all 10 levels are expected to see adjustments in their salaries and pensions.