New Delhi:
Prime Minister Narendra Modi has approved the formation of the Eighth Pay Commission to review the salary and pension structure of central employees and pensioners. Currently, the Seventh Pay Commission is in effect in the country from January 2016. It expires on 31 December 2025. The Eighth Pay Commission will review the salaries of the employees. Employees had been demanding this pay commission for a long time. The government has announced the Eighth Pay Commission at a time when the dearness allowance given to the employees has increased by more than 50 percent and the budget is going to be presented next month.
Union Minister Ashwini Vaishnav gave this information after the Union Cabinet meeting held on Thursday. He told that soon the names of a chairman and two members will be announced for the Eighth Pay Commission. However, he did not tell when the Eighth Pay Commission would be constituted.
Prime Minister @narendramodi approves setup of the 8th Central Pay Commission for all employees of the Central Government.
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,… pic.twitter.com/t5ghZ7kkwU
— PIB India (@PIB_India) January 16, 2025
What does the pay commission do?
The Pay Commission will re-determine the salaries and pensions of employees and pensioners. After this, it is estimated that there will be an increase in the salary and pension of central employees in 2026. According to the recommendations of this Pay Commission, state governments also increase the salaries and pensions of their employees and pensioners. The Pay Commission also recommends changes in the pay and allowances as well as pension of central government employees and pensioners as well as defense forces. Generally the pay commission is for 10 years. But the government has said many times that there is no fixed time limit for this.
While reviewing the salaries of the employees, the Pay Commission keeps in mind the economic conditions, inflation, fiscal position of the government along with many other factors. It is also important to know here that it is not necessary that the government accepts the recommendations of the Pay Commission. If it wishes, it can refuse to accept the recommendations of the Commission. Many times governments have gone beyond the recommendations of the Commission. Like the Sixth Pay Commission had recommended fitment factor 1.74. But the government had increased it to 1.86. After the recommendations of the Pay Commission come, it requires the approval of the Union Cabinet.
Pay Commission only reviews the salary. He does not do anything about dearness allowance. The government takes the decision on dearness allowance. It is usually extended twice a year, once in January and second time in July. The Central Government has taken the decision to constitute the Eighth Pay Commission at a time when employees are getting dearness allowance equal to 53 percent of their basic salary from July 1, 2024. An increase in dearness allowance of these employees is to happen only in January 2025.
What were the recommendations of the Seventh Pay Commission?
The minimum basic salary was increased from Rs 7,000 per month to Rs 18,000 per month.
Fitment Factor 2.57
The salaries and pensions of employees and pensioners were completely reviewed.
Health insurance scheme was started for employees.
The pension of employees who retired before January 1, 2016 was revised.
What is fitment factor?
The previous Seventh Pay Commission came into effect from January 1, 2016. In this, the minimum salary of employees increased from Rs 7,000 to Rs 18,000 per month. That means the Pay Commission had recommended increasing the salary by 2.57 times the basic salary. This increase is called fitment factor. That is, we can say that the fitment factor in the Seventh Pay Commission was 2.57. Now seeing the way inflation is increasing, employees are hopeful that the fitment factor in this pay commission may go up to 2.86. If the Eighth Pay Commission fixes the fitment factor at 2.86, then the basic salary of the employees will become Rs 51,480. At the same time, the minimum pension can increase from Rs 9,000 per month to Rs 25,740 per month. This fitment factor plays a major role in determining the salary and pension of central government employees and pensioners.
Earlier, the Sixth Pay Commission was implemented from January 1, 2006. In this, the minimum salary increased from Rs 2750 per month to Rs 7000 per month. Pay Commission is usually constituted every 10 years. The first pay commission in the country was constituted in 1946. Since then, seven pay commissions have been constituted. The seventh pay commission was constituted in 2014. Its recommendations came into effect on January 1, 2016.
Also read: Happy day for 1 crore central employees, approval given for formation of 8th Pay Commission
