8th Pay Commission- Good news for central government employees. The Modi government at the Center had announced the formation of the 8th Pay Commission in January 2025, but till now the official notification regarding its members and Terms of Reference (ToR) has not been issued. ToR i.e. the scope and responsibilities of the commission determine which aspects the commission will consider.
Let us tell you that the purpose of the 8th Pay Commission is to change the salary and pension structure of central employees and pensioners. Although there may be a delay in its implementation, but the employees will get the arrears retrospectively from 2026. Central government employees and pensioners are expecting a salary structure from this commission.
These allowances will end!
Some media reports are saying that like the 7th Pay Commission, this time also some allowances may be abolished or merged into bigger allowances so that the salary structure can be simplified further. This may include travel allowance, special duty allowance and small regional allowances.
Salary based on fitment factor
The basis of salary hike will be the ‘fitment factor’, which is a multiplier applied to the basic pay. According to analysts’ estimates, this factor can be between 1.83 to 2.86, which means that the salary of the employees can increase by about 13% to 34%. Currently, employees are getting a dearness allowance (DA) of 55%. With the implementation of the 8th Pay Commission, this DA will be reset to zero and will be added directly to the basic pay. The effect of this will be that the initial increase will seem limited to some extent, but employees will get long-term benefits, because pension is also linked to basic pay and DA.
When will it be implemented?
Given the experience of previous pay commissions, experts estimate that this time too it may take some time for the recommendations of the commission to be implemented. It is believed that the recommendations of the commission can be implemented by the beginning of 2028, although the effect of salary hike and arrears will be counted from January 1, 2026. This decision will directly benefit about 49 lakh central employees and 65 lakh pensioners.
This means that in total it will affect the income and pension structure of more than one crore people. Employees and pensioners hope that the 8th Pay Commission will not only increase the basic salary and pension but will also make the salary structure more simple and transparent by including dearness allowance (DA) and other small allowances.
How will your salary be calculated in the 8th Pay Commission?
Suppose in the 7th Pay Commission, if the current basic salary of an employee is Rs 30,000 and the government decides a fitment factor of 2.00, then the calculation of your new basic salary will be New Basic Salary = Rs 30,000 x 2.00 = Rs 60,000. It is worth noting that this is just an estimate, the actual figure will come only after the recommendations of the commission.