Good News Soon! 8th Pay Commission: Salary Hike Likely To Rs 37,440 From Rs 18,000, Pensions May Double

8th Pay Commission: Since the time Union Cabinet has approved the introduction for 8th Pay Commission, expectations of its pay matrix has taken the limelight. This time a new report stated that the government could choose a fitment factor of 1.92-2.08, which may lead to 108% hike in salaries of PSU employees and pensions could more than double accordingly.

It needs to be noted that details of pay matrix, calculation and dearness allowance under 8th Pay Commission is not officially announced. GoodReturns.In also could not confirm the below expectations of pay matric under 8th Pay Commission.

Earlier in January, the PM Narendra Modi-backed Cabinet has approved the setup of the 8th Central Pay Commission for all employees of the central government. The 8th Pay Commission is likely to be the extended version of 7th Pay Commission, aimed at improving the living standard of government employees. Accordingly, central government employees salary structures will change ahead.

8th Pay Commission Official Announcement:

The only official announcement is that the government will setup 8th Pay Commission for all employees. The government is going to receiver and review recommendations in 2025, and implementation is likely in 2026.

On January 16, Union Minister Ashwini Vaishnaw said, "Prime Minister Narendra Modi approves setup of the 8th Central Pay Commission for all employees of the Central Government." He added, "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."

Further, PM Modi has tweeted through his X handler that the 8th Pay Commission will improve quality of life and give a boost to consumption. The move is a part of Viksit Bharat.

8th Pay Commission Salary Hike Expectations:

Shiv Gopal Mishra, secretary of the National Council of Joint Consultative Machinery (NC-JCM), recently in a media interview, reportedly revealed that the 8th Pay Commission will likely recommend a fitment factor of at least 2.86.

Refuting the 2.86 fitment factor, former finance secretary of India, Subhash Chandra Garg, told News24 that it was impossible that the government could approve the fitment factor ranging from 1.92 to 2.08. He believes that the 2.86 fitment factor is like asking for the moon.

In the interview with News234, Chandra said that the fitment factor will be determined taking into consideration the basic pay plus dearness allowance as of January 1, 2026.

As per his calculation, if the fitment factor is 2.08, then the minimum basis pay scale of central government employees could see a 108% hike to Rs 37,440 from the salary of Rs 18,000. While pensions could surge to Rs 18,720 from Rs 9,000.

As the reports, if the fitment factor was about 2.86, then up to 186% salary hike could be the case. In such a scenario, the pensions could rise to Rs 25,740 from Rs 9,000.

8th Pay Commission In Budget?

Notably, the 8th Pay Commission is approved ahead of Union Budget 2025 which will be presented on February 1st by Finance Minister Nirmala Sitharaman. Any development by FM related to the 8th Pay Commission will be in focus.

Aditi Nayar, Chief Economist, ICRA Ltd said, "While the award related to the 8th Pay Commission is unlikely to affect fiscal metrics in FY2026, the potential impact of the same should be built into the new medium-term fiscal consolidation path as well as the Finance Commission's recommendations."

What Is Pay Commission:

Indian central government set up the Pay Commission, an organisation offering recommendations related to the salary structure of all public sector employees. The Pay Commission was set up in 1947 which was the year of Independence. Since then, there have been seven pay commissions introduced for the pay structure of all civil and military divisions of the Government of India.

The latest is the 7th Pay Commission which was constituted in February 2014, with the principles and structures of emoluments of all central government civilian employees including defence forces in the country. The report was submitted in November 2015, and its recommendations were implemented in 2016 by the NDA government.