The Indian government has approved the establishment of the 8th Central Pay Commission (CPC) to revise the salaries and pensions of central government employees and pensioners. This decision was announced by Union Minister Ashwini Vaishnaw on January 16, 2025.
Key Details:
- Implementation Timeline: The 8th Pay Commission is expected to be implemented by January 1, 2026.
- Beneficiaries: Approximately 50 lakh central government employees and 65 lakh pensioners are anticipated to benefit from the revised pay structure.
- Expected Salary Increase: While the exact percentage increase has not been specified, estimates suggest that the minimum basic pay could rise significantly. Some reports indicate a potential increase of up to 186%, which would elevate the minimum basic pay from ₹18,000 to approximately ₹51,480 per month.
- Fitment Factor: The fitment factor, a multiplier used to calculate the revised pay, is expected to be between 2.5 and 2.8 times the current basic pay. This factor plays a crucial role in determining the new salary structure.
Historical Context:
Since India’s independence, seven pay commissions have been established to review and recommend changes to the salary structure of government employees. The 7th Pay Commission, which is currently in effect, recommended a minimum basic pay of ₹18,000 with a fitment factor of 2.57, leading to a significant salary increase for employees.
Implications:
The implementation of the 8th Pay Commission is expected to enhance the financial well-being of government employees and pensioners, aligning their compensation with current economic conditions and inflation rates. This move is also anticipated to boost consumption and contribute to economic growth
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