8th pay commission 2025: The 8th Pay Commission was set up by the Modi government for central government employees and pensioners. It was officially announced by the BJP government on January 16, 2025. However, even after nine months, there has been no significant progress on its formation. There is still no official notification, no Terms of Reference (ToR), and no panel members appointed. What Are Pay Commissions & How do they work for Government employees and pensioners’ salary hike?
What Are Pay Commissions For?
Pay Commissions in India are committees set up by the Government from time to time to review and suggest changes in the pay, allowances, pensions, and service conditions of central government employees, both civilian and defence, as well as pensioners. Their main goal is to ensure that salaries stay in tune with inflation, economic shifts, and modern standards while keeping the government’s finances balanced.
Key Objectives:
- Salary and Allowance Revisions: The commission reviews and updates basic pay, grade pay, and benefits like House Rent Allowance (HRA) and Transport Allowance to match the rising cost of living.
- Pension Reforms: It also revises pension benefits and Dearness Relief (DR) to ensure financial support for over 65 lakh pensioners.
- Fairness and Efficiency: The panel compares government pay with salaries in private and public sectors to reduce gaps and encourage skilled employees to stay in government service.
- Economic Balance: While recommending changes, it considers the country’s GDP growth, inflation (based on the All India Consumer Price Index), and the government’s budget to maintain financial stability.
When was the 1st commission formed?
The first pay commission was formed in 1946. After that, seven commissions have been formed roughly every decade, which reportedly impacted 50 lakh employees and 65 lakh pensioners. The 7th CPC was implemented in 2016, raised minimum pay from ₹7,000 to ₹18,000 and introduced a pay matrix.
Structure of pay commission
- It will include a chairman (typically a retired Supreme Court judge or senior bureaucrat)
- 2–4 members from finance, economics, and administration
Impact of the 8th pay commission on Government employees
- The minimum pension could increase by about ₹20,500, reaching ₹25,740.
- Around 5 million central government employees and 6.5 million pensioners will benefit from the 8th Pay Commission.
- In total, about 11.5 million people will be directly impacted.
- Salaries and pensions are expected to rise by 30–34%.
- The fitment factor could be revised in the range of 1.83 to 2.86, directly affecting employees’ basic pay.
- The government has approved the 8th Pay Commission, but the formal establishment and notification of its Terms of Reference (ToR) are still pending.
- The minimum basic pay for Level 1 employees may be revised to ₹51,480.
Current status of the 8th Pay Commission
- The big announcement was made on January 16, 2025.
- But the ToR or list of members has not yet been released.
- This means the actual process hasn’t even begun.
Timeline of the 6th Pay Commission
- The 6th pay panel was constituted in October 2006
- The commission report was submitted to the government in March 2008
- The government accepted the report in August 2008
- The government implemented the panel’s recommendations retrospectively from January 1, 2006
- So, it took approximately 22–24 months from the formation to the implementation of 6th Pay Commission
Timeline of the 7th Pay Commission
- Constituted in February 2014
- Terms of Reference (ToR) were finalised by March 2014
- The commission submitted its report in November 2015
- The government accepted the recommendations in June 2016
- The government implemented them from January 1, 2016
- This means that it took approximately 33 months (2 years and 9 months) from its formation to implementation
- This comparison clearly shows that both commissions took an average of 2–3 years
