8th Pay Commission: Millions of government employees and pensioners across the country are eagerly awaiting the new pay commission. Recently, a major update regarding the 8th Pay Commission has come to the forefront, which could bring smiles to the faces of central government employees and pensioners. According to a report by a financial brokerage firm, MK Global, the salaries and pensions of employees could see a significant increase in the new pay commission. Let’s delve into the details.
How Much Can Salary and Pension Increase?
According to the MK Global report, the salary and pension of central government employees and pensioners could increase by 30% to 34% under the 8th Pay Commission. This increase is significantly higher than the 14.3% hike seen with the 7th Pay Commission in 2016. This hike is expected to benefit approximately 1.12 crore central government employees and pensioners.
Fitment Factor and Financial Impact on the Government
The report suggests that the fitment factor could be between 1.83 and 2.46, which plays a crucial role in determining the salary structure of the employees. However, this salary hike will also impose a significant financial burden on the government. It is estimated that the implementation of the 8th Pay Commission will result in an additional financial burden of about 1.3 to 1.8 lakh crore rupees on the government.
Potential Impact on the Economy
The increase in the income of employees and pensioners is expected to have a positive impact on the country’s economy. With more money in people’s hands, market demand will increase, especially in the FMCG, banking, automobile, and food sectors. This, in turn, will boost the country’s overall economic growth.
Reasons for Implementation Delay
While the news of the salary hike is joyful for the employees, its implementation might face some delays. It was initially expected that the 8th Pay Commission would be implemented by 2026, but it now seems that it might be implemented in late 2026 or early 2027. There are several reasons behind this:
- The “Terms of Reference” have not been issued yet.
- The Chairman and members of the commission have not yet been appointed.
- The deadline for appointments related to the commission has been extended multiple times, now until July 31, 2025.
- No official gazette notification has been issued so far.
Demands from Employee Organizations
Employee organizations like the Railway Senior Citizen Welfare Society have expressed concerns over this delay. They have written to the Prime Minister demanding the timely formation of the commission, the release of the “Terms of Reference,” immediate appointment of the Chairman and members, and a specific timeline for its implementation by January 2026.
New Pension Scheme (UPS)
There is also big news for pensioners. The government is set to launch the Unified Pension Scheme (UPS) from April 2025. It is a hybrid model of the NPS and OPS, which will guarantee 50% of the last drawn salary as pension.
