As the 7th Pay Commission ends on December 31, 2025, anticipation grows for the 8th Pay Commission among lakhs of government employees and pensioners.
With over 50 lakh central government employees and 62 lakh pensioners hoping for a better deal, the expectations for a more generous salary structure are high.
8th Pay Commission Announcement and Timeline
The 8th Pay Commission was officially announced in January 2024, though a chairman is yet to be appointed. This delay may push back the formation and implementation process. Historically, the government forms a pay commission every 10 years to align public sector salaries with private sector standards and attract young talent.
Salary Structure and Allowances
Government employees’ pay isn’t based on basic salary alone. It also includes components such as:
Dearness Allowance (DA)
House Rent Allowance (HRA)
Travel Allowance (TA)
Other employment benefits
Previously, basic pay made up about 65% of the total salary. It now contributes roughly 50%, highlighting the growing significance of allowances.
The DA is reviewed twice a year, adjusted to inflation based on the Consumer Price Index (CPI). While no official word on a final DA hike under the 7th Pay Commission has been issued yet, sources suggest clarity may emerge by August 15.
Fitment Factor and Salary Projections
The fitment factor is a key element in deciding salary increases. The 7th Pay Commission had set it at 2.57. However, Ambit Capital reports that the 8th Commission may propose a factor between 1.83 and 2.46. For example, an employee earning a basic salary of ₹18,000 could see their income rise to ₹44,280 if a 2.46 factor is approved.
Notably, the 7th Pay Commission had suggested a 14.3% hike in basic pay-the lowest since 1970. In contrast, the 6th Pay Commission had proposed a massive 54% hike. However, thanks to periodic DA revisions, overall salary growth under the seventh commission still touched around 23%.
Will the 8th Pay Commission Be Implemented by January 2026?
Even if the 8th Commission is formed by late 2025, experts say compiling the report, securing cabinet approval, and rolling out the changes could take 18 to 24 months. Hence, a January 2026 implementation is unlikely, though not impossible.
Meanwhile, speculation is rife that the final DA hike under may be announced on Independence Day, August 15.