8th Pay Commission Approved: Key Highlights
The Union Cabinet, chaired by Prime Minister Narendra Modi, has given the green light to establish the 8th Pay Commission, which will propose revisions to salaries and pensions for central government employees. Announced by Information and Broadcasting Minister Ashwini Vaishnaw, this development follows a surge in the dearness allowance (DA) beyond 50% of basic pay.
- Implementation Timeline: The new pay scales are expected to take effect from 2025.
- Focus on Quality of Life: Modi emphasized that this initiative will enhance consumption and improve living standards for government employees.
Salary Hike Expectations Under the 8th Pay Commission
Experts predict substantial pay hikes, drawing parallels to the 7th Pay Commission’s recommendations in 2016.
- Fitment Factor: Expected to rise from 2.57 to 2.86, translating to a significant pay boost.
- Minimum Basic Pay: Anticipated to jump from ₹18,000 to ₹51,480 per month, marking a 186% increase.
- Retirement Benefits: Enhanced pensions, EPF, gratuity, and other benefits are likely to accompany salary hikes.
Performance-based pay structures are also under consideration, suggesting a shift towards rewarding merit and productivity.
Insights from the 7th Pay Commission
The 7th Pay Commission introduced notable changes to salary structures, which have set a benchmark for the upcoming revisions.
- Minimum Basic Pay: Increased from ₹7,000 to ₹18,000 per month with a 2.57 fitment factor.
- Pension Enhancements: Minimum pensions rose from ₹3,500 to ₹9,000 per month.
- Maximum Salary: Capped at ₹2,50,000, with pensions reaching ₹1,25,000.
The upcoming 8th Pay Commission aims to build upon these advancements to address inflation and economic shifts.
Who Will Benefit?
Approximately 49 lakh central government employees and 65 lakh pensioners are set to benefit from the 8th Pay Commission. However, employees of public sector undertakings (PSUs) and autonomous bodies fall outside its purview.
What’s Next?
The 8th Pay Commission will soon appoint a chairman and two members to define the terms of reference (ToR). Consultations with central and state governments, alongside other stakeholders, will guide the commission’s proposals.
As India marches toward a “Viksit Bharat,” the 8th Pay Commission is poised to play a pivotal role in improving the financial well-being of its workforce, further fueling economic growth and consumption.
