Pay revision on the cards for 50 lakh employees and 65 lakh pensioners, with potential monthly hikes up to ₹19,000. Implementation expected by 2026–27.
March 26, 2025: The 8th Pay Commission could bring a significant salary boost for central government employees and pensioners, with estimates suggesting hikes of up to ₹19,000 per month, according to a report by Goldman Sachs. While the government has not yet officially constituted the commission, expert predictions hint at an April 2025 announcement and implementation between 2026 and 2027.
What is the Pay Commission?
The Pay Commission is a government-appointed body tasked with reviewing and recommending revisions in salaries, pensions, and benefits for central government staff. Typically formed every 10 years, it considers factors like inflation, cost of living, and economic growth.
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Projected Salary Hike Estimates
Currently, a mid-level government employee earns about ₹1 lakh (pre-tax) per month. Based on the budgetary allocation, projected salary hikes could be:
- ₹1.75 lakh crore allocation: ₹1,14,600/month
- ₹2.00 lakh crore allocation: ₹1,16,700/month
- ₹2.25 lakh crore allocation: ₹1,18,800/month
These numbers suggest a monthly increase of ₹14,600 to ₹18,800, depending on the final allocation.
Timeline and Expectations
While official confirmation is pending, experts anticipate that the 8th Pay Commission could be set up post-April 2025, with recommendations likely to be rolled out by 2026 or 2027.
What Happened During the 7th Pay Commission?
The 7th Pay Commission, implemented in 2016, raised the minimum basic salary from ₹7,000 to ₹18,000 and applied a fitment factor of 2.57. It impacted nearly 1.1 crore individuals and cost the government ₹1.02 lakh crore in FY17.
Expectations from the 8th Commission include:
- A fitment factor of 3.0 or more (as demanded by unions)
- Revised basic pay structure and allowances
- Consultation with employee unions and stakeholders
However, former Finance Secretary Subhash Chandra Garg believes a fitment factor closer to 1.92 is more realistic, suggesting modest raises compared to 2016.
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