8th Pay Commission: Exciting news for Central Government employees! The government has just revealed the Terms of Reference (ToR) for the 8th Pay Commission, outlining the working methods and guidelines. This announcement has raised employees’ hopes for a significant boost in their salaries, allowances, and pensions in the coming years.
The Commission is tasked with delivering its recommendations to the government within 18 months, specifically by April 2027. Following this, the Labor and Finance Ministry will review and approve the report. Once approved by the Cabinet, the implementation of the 8th Pay Commission is expected to occur by Diwali 2027. However, the exact timing of the implementation will ultimately depend on the government’s decision.
The 8th Pay Commission will be composed of three members, with Justice Ranjan Desai serving as the chairperson. Professor Pulak Ghosh has been appointed as a part-time member, and Pankaj Jain will act as the member-secretary. The commission is required to submit its recommendations to the government within 18 months, which means by April 2027. However, the commission has the option to provide interim reports periodically if it chooses to do so.
When will the commission submit its report?
As per a government notification, the commission must submit its report within 18 months from its formation date, with a deadline set for April 2027. Once the report is submitted, the government will review it and, upon approval, will implement the new salary structure.
How much can the salary increase?
A major concern for employees is the potential increase in their salaries. Estimates from financial institutions like Kotak Institutional Equities and Ambit Capital suggest that the fitment factor this time could range from 1.8 to 2.46.
If the fitment factor is established at 1.8, the basic salary for Level-1 employees, such as attendants or peons, will rise from Rs 18,000 to Rs 32,400. While this appears to be an 80% increase, the actual increase will be around 13-15% since the dearness allowance (DA) will reset to 0% upon implementation of the new salary.