Mumbai, January 20: Ahead of the Union Budget on February 1, the Narendra Modi-led Union Cabinet approved the formation of the 8th Pay Commission on Thursday, January 16. The 8th pay commission will revise the salaries and other allowances of central government employees. Additionally, the pensions of the central government employees are also set to be revised. Union Minister Ashwini Vaishnaw confirmed the formation of the 8th Pay commission on January 16.

8th Pay Recommendations To Be Effective From January 1, 2026

Vaishnaw also said that the recommendations of the 8th pay commission would take effect from January 1, 2026. At present, there are 49 lakh central government employees and nearly 65 lakh pensioners who are likely to be affected by the upcoming 8th Pay Commission. As of now, salaries and pensions of Central government employees are based on the 7th Pay Commission's recommendations, which was implemented on January 1, 2016. 8th Pay Commission Approved: 8th CPC To Potentially Increase Salaries by 25–30% and Pensions Proportionately, Say Industry Experts.

Minimum Pension To Increase With Approval of 2.86 Fitment Factor

Following the Centre's announcement of the 8th Pay Commission, central government employees can expect salary hikes which is likely to be followed by adjustments in allowance. Similarly, the fitment factor, which is used to calculate salaries and revised pay of pensioners is also expected to be hiked from 2.57 to 2.86. This means, the basic minimum could be raised from INR 18,000 to INR 51,480.

Besides hiking salaries, the 8th Pay Commission is also expected to bring significant changes to pensions under the National Pension System (NPS) and the Unified Pension Scheme (UPS). If the fitment factor is raised from 2.57 to 2.86 times, then the pensions are also likely to increase from the current INR 9,000 to anywhere between INR 17,000 and INR 26,000. 8th Pay Commission Approved by PM Narendra Modi: Here’s Timeline and Key Facts.

Apart from the hike in the basic pension allowance, other perks under the 8th pay commission will also go through massive revision. The implementation of 2.86 fitment factor would raise the salary structures by nearly 186 per cent. However, official announcement from the Centre will confirm the same.

(The above story first appeared on LatestLY on Jan 20, 2025 01:05 PM IST. For more news and updates on politics, world, sports, entertainment and lifestyle, log on to our website latestly.com).