In this regard, the 8th Pay Commission, which is said to have benefitted some 50 million central government employees and 65 million pensioners, has been a matter of heated discussion. It was errected in January, 2025, and implementation might occur by late 2026-early 2027. However, a recent report might have dampened the expectations for a higher pay increase, now putting at least a few million salary-earners in a very precarious financial position.
Revised Salary Expectations
There were early rumors of a huge jump in minimum pay from Rs.18,000 to Rs.51,000, stemming from expectations of high fitment. But now it looks like the hike will be more modest, the minimum basic salary to be raised to about Rs.30,000, signifying an average increase in pay of 13%. This is comparatively lesser than the 14.3% hike given by the Seventh Pay Commission, which really did shock those expecting their basic pay to be tripled.
Effects of Fitment Factor and DA Reset
The fitment factor is a multiplier given on the basic salary and is slated to be somewhere around 1.8, a figure considerably lower than the 2.57 figure given by the 7th Pay Commission. In such a case, a person with a basic salary of ₹50,000 gets a fitment or basic salary after fitment of ₹90,000, but since the DA is to be set to zero upon implementation, the employee will not gain much. At present, a ₹50,000 basic salary has an additional 55% DA amounting to ₹27,500, which brings the gross salary and net effective increase less than would be contemplated. By 2026, or before, DA is likely to touch well above 60%, making salary calculations more complex.
Economic and Employment Implications
With appreciable consumption expected in the automobile and consumer goods sectors, a modest pay increase could add 0.6-0.8 percentage points to annual GDP growth. Grade C employees, 90% of all central government employees, should benefit the most and see their lifestyle changes. Dejectedly, for the feeling of dejection due to the increase being low, employee morale and financial planning have been raised as concerns, with unions demanding raising the fitment factor.
Also Read:Salary Hike Alert 2025: Central Employees May Get RS 51,000 Basic Pay Soon