Only a few days are left for the presentation of Budget 2025. Earlier on January 16, the Union Cabinet approved the 8th Pay Commission to revise the salaries and other allowances of central government employees.
This is sure to change the salary of central government employees as well as the pension of pensioners. This move will benefit about 50 lakh central government employees and about 65 lakh pensioners, including those working in the defense sector. The 7th Pay Commission was constituted in 2014 and its recommendations came into effect from January 1, 2016. Its term ends in 2026.
Under the 8th Pay Commission, central government employees can expect adjustments in allowances after the salary hike. It is possible that the fitment factor used for calculating the salary and pension of employees may be increased from 2.57 to 2.86. If this happens, the basic minimum pay of employees may increase from Rs 18,000 to Rs 51,480. Due to the expected increase in the fitment factor, not only is the salary expected to increase, but the pension structure may also change.
How much can the pension increase
It is being said that if the fitment factor is increased to 2.86 under the 8th Pay Commission, then the pension of central government pensioners can increase from the current Rs 9,000 to between Rs 22500-25200. Apart from the increase in basic pension, other allowances will also increase on a large scale. The 2.86 fitment factor will increase the salary structure by about 186 percent.
In the 7th Pay Commission, the minimum basic salary of central government employees increased from Rs 7,000 to Rs 18,000 with a prescribed fitment factor of 2.57. The minimum pension also increased from Rs 2,500 to Rs 9,000.
A new pay commission is formed every 10 years
The chairman and two commission members for the 8th Pay Commission will be appointed soon and consultations will be held between central and state ministers and other stakeholders for the related decisions. Usually, the central government constitutes a pay commission every 10 years to revise the salaries of its employees. State governments also revise the salaries of their employees on the lines of the Central Pay Commission.
