The government may soon announce the formation of the Eighth Pay Commission. Along with this, the government can implement a new formula for dearness allowance under the Eighth Pay Commission.
Great news is coming for government employees. The central government may soon formally announce the formation of the Eighth Pay Commission. This has revived the hopes of salary hike of lakhs of employees. According to sources, this time a new formula may be implemented to adjust the Dearness Allowance, which will lead to a good increase in the salary of central employees. Also, there may be a revision in the Fitment Factor.
How far has the process of formation of the Eighth Pay Commission reached
The government had announced the formation of the Eighth Pay Commission in January 2025. The process of appointment of its chairman and members is going on. The outline of the Terms of Reference and Reference Terms for the Commission is also being prepared. It is expected that the Commission will soon submit its recommendation report to the government. Only after this the chairman and members of the commission will be appointed.
New formula for adjustment of dearness allowance
This time many speculations are being made regarding the fitment factor. Employee organizations are estimating that the fitment factor may be around 1.90 to 1.95 instead of 2.86. The government can also bring a separate new formula to adjust the dearness allowance (DA) while keeping the fitment limited. Based on past experiences, it has been seen that most of the increase gets absorbed in the DA itself.
What is the fitment factor?
The fitment factor is the basis for the increase in the basic salary. For example, if the basic salary of an employee is Rs 20,000 and the fitment factor is 2.86, then the salary will increase to Rs 57,200. But sources say that this time the fitment factor can be kept less than 2.0, as the government can apply a different formula to adjust the dearness allowance.
Figures of fitment factor in previous pay commissions
Sixth Pay Commission (2006): Fitment factor 1.86, about 54% increase in basic salary. Seventh Pay Commission (2016): Fitment factor 2.57, but actual salary increase only 14.2% because most of the increase was adjusted in dearness allowance.
Eighth Pay Commission report may take more time to come
On an average, it takes 18 to 26 months to prepare the Pay Commission report. For example, the report of the Sixth Pay Commission came in 18 months while the report of the Seventh Pay Commission took about two years to prepare. In such a situation, the report of the Eighth Pay Commission can possibly be implemented by the year 2027.
Understand the whole news in 5 easy lines
- Formation process underway: The work outline and terms of reference of the Eighth Pay Commission are being prepared.
- Fitment factor in the main role: The entire responsibility of the increase in salary will be on this.
- New strategy in view of inflation: Government is preparing to bring balance in DA and fitment.
- Comparison with previous commissions is necessary: ​​In the 6th commission, more benefits were received, in the 7th the increase was included in DA.
- Can be approved by 2027: After formation, it may take up to 2 years for the report to come.
