8th pay commission
It is being discussed a lot since the approval of the 8th Finance Commission by the Central Government. How much will the salary and pension of employees be increased in the 7th Pay Commission. How much fitment factor will be applicable. It is being estimated. But do you know that the government may get a major setback by revising the salary in the new Finance Commission. The central government may cost an additional 1.8 lakh crore burden.
According to Ambit Capital, the implementation of the new salary structure may increase by 30-34% in the total salary of more than 1 crore employees and retired people. If this change is applied, it can start from 2026 or financial year 2027. This may cost an additional burden of Rs 1.8 lakh crore in the government’s expenses.
The biggest basis for increasing salary in the 8th Pay Commission will be fitment factor. This time the fitment factor can be between 1.83 and 2.46. Meaning, the minimum salary that is currently Rs 18,000 can go up to Rs 32,940 on 1.83 fitment factor and Rs 44,280 on 2.46. For example, if someone’s basic salary is Rs 50,000, it can range from Rs 91,500 lower fitment to Rs 1.23 lakh higher fitment. Also, Dearness Allowance (DA) will be adjusted according to inflation and payment will also be updated for pensioners. These changes can be applicable from the financial year of 2026 or 2027.
Economic growth will increase
Experts believe that the 8th Pay Commission can prove to be a game-changer for the economy. Increased salary of more than 1 crore employees and pensioners will accelerate the consumption. People will spend more on healthcare, housing and laser. Retail, real estate and service sectors will get a big benefit. But this will not be easy for the government. Additional burden of 1.8 lakh crore can increase fiscal deficit. The government will have to make a balance so that the economy grows and financial stress does not increase.