The biggest good news for lakhs of central government employees and our senior pensioners is about to come the 8th Pay Commission. And the latest news from sources is that the government may form a team (panel) for this in May 2025. As soon as this team is formed, the work will also start immediately.

This means that good days are coming for crores of people waiting for a good increase in salary and pension. Now that the matter of team formation seems to be confirmed, questions are also increasing in the people’s minds, who will be in this team? What will happen to the dearness allowance (DA)? And the biggest question , how much money will increase in your pocket?

Who will make recommendations

The inside news is that the government has started forming the team of the 8th Pay Commission, and the names can be finalized by May 2025. This team is very important because it will tell the government how much the salary should increase. What will this team be like? If we look at the previous commissions, the head of the team (Chairman) is often a retired Supreme Court judge or a senior government official. Along with this, some well-known economists, experts in keeping accounts of expenses, and experts in government job rules are also included.

Who can be the members of the team

The names have not been disclosed yet, but it is expected that the team will have people who have a good understanding of the government treasury, the country’s economy, and the needs of the employees. Only then will they be able to prepare a report for the benefit of all. Employees’ unions will also give their opinion, and the government will make a decision only after listening to all the parties.

What recommendations can the team make

After the team is formed, it will first talk to employee unions, various ministries, and experts. It will see how much inflation is nowadays, how much money the government has, and what the needs of the employees are. Then it will give its report, in which special attention can be paid to these things:

Fitment factor

Fitment factor is the magical number by which your today’s basic salary is multiplied to form the new basic salary. In the 7th Pay Commission, it was 2.57 times. Employee unions are demanding to increase it to 3.68 times. But experts believe that it could be 2.80 to 3.0 times or maybe a little more.

Dearness Allowance (DA)

It is certain that when the 8th Pay Commission is implemented (estimated date 1 January 2026), whatever DA you are getting till then (more than 60% of the estimated amount), will be merged into the basic salary. The same happened with 125% DA during the 7th Commission. After the addition of DA, the DA calculation on the new basic salary will start again from 0 (zero).

New Salary Structure/Matrix

The current pay matrix can be improved. It is possible that some levels may be removed or merged so that the disparities in the salary can be corrected.

Other allowances

The rules and amount of allowances like House Rent Allowance (HRA), Conveyance Allowance (TA), and Children’s Education Allowance (CEA) may also change. HRA may change according to cities, and other allowances may also be updated according to the current times.

Pension

These recommendations will not only be for those who are currently working, but also for our elders who get more than 65 lakh pensions. How their pension will be decided will also be considered.

How much will your salary increase

The salary increase depends on two things: how much DA is added to the basic and how much fitment factor is available.

Effect of DA addition

Suppose 60% DA is added to the basic, then there will be a very good increase in the salary.

Role of fitment factor

Then the fitment factor will be added. If it is 3.0 times, your basic salary of the 7th Commission will be almost three times (including the attached DA).

Overall, employees at different levels can see a gross salary increase of 25% to 40% or even more. It will depend on your post (level), today’s basic salary, and fitment factor. For example, if someone’s basic is ₹18,000 and the fitment factor is 3.0, the new basic can be around ₹54,000.