8th Pay Commission: The central government approved the 8th Central Pay Commission in January 2025, but its official notification has not yet been issued. Furthermore, the names of the commission’s chairman and members have not yet been finalized.
Pankaj Chaudhary, Minister of State for Finance, recently informed the Rajya Sabha that the government is actively working on this matter. He stated, “The notification regarding the 8th Central Pay Commission will be issued in due course. After the commission’s formation, its chairman and members will be appointed.” The central government has also clarified that it is actively consulting with state governments and an announcement regarding the commission’s formation is expected soon.
What is the fitment factor?
The most important basis for increasing salaries and pensions in the 8th Pay Commission will be the fitment factor. This is a calculated coefficient that determines the new salary and pension amount for employees and pensioners. Simply put, new salary = basic salary × fitment factor. This time, the government is considering adopting the Aykroyd formula developed by Dr. Wallace Aykroyd. This formula helps determine salaries based on a person’s minimum cost of living. It includes essential expenses such as food, clothing, and housing.
How is the fitment factor determined?
Currently, the dearness allowance (DA) is 58%, which is expected to reach 60% by the time the 8th Pay Commission is implemented. In this situation, the base fitment factor will be considered 1.60. Subsequent increases of 10% to 30% are possible. If 1.60 is increased by 20%, the new fitment factor will be 1.92. A 30% increase could take it to 2.08. This means that the fitment factor in the 8th Pay Commission could range from 1.8 to 2.08.
What can change now after the 7th Pay Commission?
Under the current (7th Pay Commission) system, the minimum basic salary for central government employees is ₹18,000, while pensioners receive a minimum pension of ₹9,000. Additionally, a 58% dearness allowance (DA/DR) is added. With the implementation of the 8th Pay Commission, significant increases in salaries and pensions based on the fitment factor are expected.
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