BREAKING: Good News! Cabinet Approves 8th Pay Commission; Govt Employees, Pensioners to Get Massive Pay Hike

8th Pay Commission Latest News update: Union Minister Ashwini Vaishnaw announced during a cabinet briefing that the government, under the leadership of Prime Minister Narendra Modi , has approved the formation of the 8th Central Pay Commission. This comes as good news for lakhs of government employees and pensioners, as the move promises to revise their pay structure and benefits significantly.

The 8th Pay Commission is expected to be established by 2026, following the conclusion of the 7th Pay Commission's recommendations, which were implemented in January 2016. Ashwini Vaishnaw stated that the 7th Pay Commission, which has been in effect since 2016, remains valid until 2026. The government has approved the formation of the 8th Pay Commission to ensure timely recommendations for implementation from 2026 onwards. 

"Since 1947, seven pay commissions have been constituted, with the last one implemented in 2016. As the 7th Pay Commission's term concludes in 2026, initiating the process in 2025 ensures sufficient time to receive and review recommendations before its completion," Vaishnaw said.  

Proposed Salary Hike Under 8th Pay Commission

Recent media reports suggest that the government will be urged to implement a salary hike of 2.86 times under the new pay commission. This increase will be calculated using a fitment factor of 2.86, as proposed by the National Council of the Joint Consultative Machinery (NC-JCM).

What is the Fitment Factor?

The fitment factor is a multiplier used to revise the salaries of government employees and the pensions of retirees.

Proposed Salary Hike Under 8th Pay Commission

Recent media reports suggest that the government will be urged to implement a salary hike of 2.86 times under the new pay commission. This increase will be calculated using a fitment factor of 2.86, as proposed by the National Council of the Joint Consultative Machinery (NC-JCM).

What is the Fitment Factor?

The fitment factor is a multiplier used to revise the salaries of government employees and the pensions of retirees.

Fitment Factor Under 7th Pay Commission

Under the 7th Pay Commission, the central government used a fitment factor of 2.57, which led to an increase in the minimum salary from ₹7,000 to ₹18,000.

With every new pay commission, changes are made to salaries and pensions. Currently, central employees receive salaries based on a fitment factor of 2.57. If this factor is increased to 2.86, there could be a significant rise in basic salaries. For example:

• Current minimum basic salary: ₹18,000
• Revised minimum basic salary with a fitment factor of 2.86: ₹51,480

Effect on Pension

An increase in the fitment factor will also lead to a substantial change in pensions. At present, the minimum pension is ₹9,000. If the fitment factor is raised to 2.86, it could increase to ₹25,740.

Thus, if the 8th Pay Commission recommends a fitment factor of 2.86, it could lead to a 186% increase in the minimum salary, raising it from the current ₹17,990 to ₹51,451. Similarly, the minimum pension could see a rise from ₹9,000 to ₹25,740.

Dearness Allowance Revision On Cards?

In addition to the fitment factor, dearness allowance (DA) is a key component of the salaries and pensions of central employees. With changes in the basic salary, dearness allowance and other government-provided perks will also be revised.

Unified Pension Scheme (UPS)

The Unified Pension Scheme (UPS) is set to be implemented from April 1, 2025. Under this scheme, pensions will be calculated based on the salary of the 12 months prior to retirement. This is also expected to result in an increase in the pensions received post-retirement.