The Central Government has formally declared the rollout of the 8th Pay Commission, which is expected to result in a substantial salary increase for approximately 49 lakh central government employees and 65 lakh pensioners. Scheduled to take effect from January 1, 2026, the commission’s recommendations are drawing significant attention for the likely boost in both pay and pensions.
A key topic of discussion surrounding the 8th Pay Commission is the proposed fitment factor, which significantly influences the scale of the salary hike. According to experts, the fitment factor is expected to range between 2.6 and 2.85, potentially leading to a 25% to 30% rise in basic pay. For instance, an employee currently receiving a basic salary of ₹20,000 could see it increase to between ₹46,600 and ₹57,200 under the revised structure. This adjustment will also affect various allowances like Dearness Allowance (DA), House Rent Allowance (HRA), and Travel Allowance (TA), resulting in an overall financial boost for employees.
Pensioners are also expected to benefit significantly from the 8th Pay Commission’s recommendations. The minimum pension is likely to be revised upward from ₹9,000 to between ₹22,500 and ₹25,200. These adjustments will be proportionate to the revisions made to employee salaries, ensuring that retired government staff also receive the intended financial boost.
Historically, every pay commission has introduced substantial changes. The 7th Pay Commission, implemented in 2016, had a fitment factor of 2.57. In comparison, the 6th Pay Commission (2006) offered 1.86, and the 5th Pay Commission (1996) marked its own milestones. The 8th Pay Commission appears poised to continue this legacy with its expected salary hike, reflecting inflation and the evolving economic landscape. The expected hike in basic salary will also lead to increased contributions to the National Pension System (NPS), where employees contribute 10% of their basic pay plus DA, while the government contributes 14%. Similarly, under the Central Government Health Scheme (CGHS), subscription charges and slabs will be revised according to the new pay structure. These changes ensure that both savings and healthcare benefits align with the new salary framework.
The salary hike under the 8th Pay Commission is not just a bureaucratic reform-it has the potential to stimulate the economy by boosting the purchasing power of millions of government employees and retirees. With implementation scheduled for January 2026, the government is expected to release a draft report soon, followed by consultations with employee unions and stakeholders before final approval.
