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8th Pay Commission: The previous pay commission recommended an increase of around 14-15 per cent; the additional fitment factor to be applied to the base factor of 1.6 is likely to range between 10-30 per cent, says former finance secretary S C Garg.
8th Pay Commission: The former finance secretary says a fitment factor of 2.86 per cent is “asking for the moon, which is impossible to get”.
8th Pay Commission: Even as the goverment has announced the 8th Pay Commission that will submit its report by the end of this year, there are speculation going on regarding the salary hike for the central government employees. According to the latest reports, the employees are likely to see salary hikes between 10 per cent and 30 per cent as against the huge 186 per cent increment being talked about.
“NC-JCM (National Council of Joint Consultative Machinery) can ask for the moon. Fitment factor of 2.86 per cent is asking for the moon, which is impossible to get,” said Subhash Chandra Garg, former finance secretary of India, in a media interview.
He said that to determine the fitment factor, the pay commission will consider the basic pay plus Dearness Allowance (DA) as of January 1, 2026.
The fitment factor is a multiplier applied to the current basic pay to calculate the new salary under the revised Pay Matrix.
Currently, the DA is 53 per cent (as of July 1, 2024). To calculate the DA till January 1, 2026, two more installments need to be added: one due on January 1, 2025, and another on July 1, 2025. Assuming a 7 per cent increase, the DA for January 1, 2026, would be approximately 60 per cent, Garg said.
“With the starting factor of 1.6, the next step is to determine the percentage increase. Usually, pay commissions have recommended increases ranging from 15 per cent to 30 per cent. The previous pay commission recommended an increase of around 14-15 per cent. In my assessment, the additional fitment factor to be applied to the base factor of 1.6 is likely to range between 10-30 per cent,” he said in the interview with news channel News24.
He said that taking 20 per cent of the base factor 1.6 or 160, we get 32. Adding 32 to 160 results in a revised fitment factor of 192 or 1.92.
“If we assume a more generous 30 per cent increase, the calculation would be: 30 per cent of 160 is 48. Adding this to the base factor, we get 208, or a revised fitment factor of 2.08. So, the actual fitment factor is likely to be between 1.92-2.08,” he said.
Under the 7th Pay Commission, the fitment factor was set at 2.57, which increased the minimum basic pay from Rs 7,000 to Rs 18,000.
8th Pay Commission
For the 8th Pay Commission, it was widely expected that the fitment factor will rise to 2.86, potentially increasing the minimum basic pay to Rs 51,480, an apparent jump of 186 per cent over the current Rs 18,000.
The Union Cabinet on January 16 approved the 8th Pay Commission. Announcing the decision, Union Information and Broadcasting Minister Ashwini Vaishnaw said, “The establishment of the 8th Pay Commission in 2025 ensures sufficient time for recommendations to be implemented before the 7th Pay Commission period ends.”
The 7th Pay Commission Tenure
The current 7th Pay Commission’s tenure will conclude on December 31, 2025, which comes 10 years after its implementation on January 1, 2016.
So, the 8th Pay Commission will be implemented with effect from January 1, 2026.
Central government pensioners will also receive higher pension with effect from January 2026.
The central government typically constitutes a pay commission every 10 years. The current 7th Pay Commission was formed in 2014 and its recommendations were implemented from January 2016, exactly 10 years after the 6th Pay Commission implementation on January 1, 2006.
