The central government has permitted the forwarding of the terms of reference for the 8th Pay Commission. Former Supreme Court Justice Ranjana Prakash Desai has been chosen to be the chair of the committee. The report is to be released to the Centre within 18 months afterward, upon which the government will take a final decision. The 8th Pay Commission is expected to start on January 1, 2026.

Who Will Benefit?

If launched, more than 50 lakh central government employees and about 69 lakh pensioners will be benefitted. The government constructs a thin form of new payment every 10 years. The Modi Cabinet sanctioned the reconnaissance of the 8th Pay Commission on January 16. Earlier, the two previous payments had been allocated from 2016 onwards, and will end on December 31, 2025.

Salary Hike Expectations

Government employees are glad to hear this news as it has meant a pay raise since some have been made accordingly. Many employees are eager to know how much their salary will increase. Economic analysts state this mean many, additional lakhs of employees will benefit employing a similar formula to that of the 7th Pay Commission as was. The 7th Pay Commission naturally was when the basic salary was increased by Rs 7000 to Rs 18,000 directly.

If the same formula is used again, salaries may rise from ₹18,000 to ₹51,480. In this case, the fitment factor will play an important role.

Salary Calculation

The salary increase under the 8th Pay Commission will depend on the fitment factor and Dearness Allowance (DA). Under the 7th Pay Commission, the fitment factor was 2.57, which may rise to 2.86 this time. With every new pay commission, the DA becomes zero. At present, government employees get 58% DA under the 7th Pay Commission.

7th Pay Commission Example

  • Basic Pay: ₹25,000
  • DA (58%): ₹14,500
  • HRA (Metro, 27%): ₹6,750
  • Total Salary: ₹46,250

8th Pay Commission Example

  • Basic Pay: ₹25,000 × 2.86 = ₹71,500
  • DA: ₹0
  • HRA (Metro, 27%): ₹19,305
  • Total Salary: ₹71,500 + ₹19,305 = ₹90,805

If someone’s basic pension is ₹9,000, it will increase to ₹25,740 after the implementation of the 8th Pay Commission.

The fitment factor depends on inflation and the cost of living. It is calculated based on the basic salary of employees and pensioners. To find your new basic pay, multiply your current basic salary by the fitment factor.