8th Pay Commission Latest Update: The big 8th Pay Commission wait is over as the Union Cabinet approved the terms of reference for the central pay commission on Tuesday. As per composition approved by the Cabinet, Justice Ranjana Prakash Desai will act as the chairperson. Professor Pulak Ghosh will be part time member and Pankaj Jain will be member-secretary). Jain is presently working as secretary, petroleum and natural gas.
The government had announced the formation of 8th Pay Commission on January 16 earlier this year. The ToR's approval comes after several rounds of consultations with ministries and other departments. The consultation also included the staff side of the Joint Consultative Machinery. As per the Tuesday announcement, the 8th pay Commission will be required to submit the recommendations within 18 months.
The rollout of the 8th Central Pay Commission (CPC) is expected sometime in late 2026 or early 2027, according to estimates.
Kotak Institutional Equities, in its recent assessment, said this timeline aligns with the implementation pattern of earlier pay commissions, which typically take about 1.5 years from the date of announcement to become effective.
As per Kotak's projections, the minimum basic pay under the upcoming pay commission could rise to around Rs 30,000, up from the current Rs 18,000. The report also suggests that the CPC may adopt a fitment factor of 1.8, implying an overall real pay hike of roughly 13%.
Further, Kotak estimates the fiscal impact of the 8th Pay Commission to be around 0.8% of GDP, translating to an additional Rs 2.4-3.2 lakh crore burden on the national exchequer.
Historically, a Central Pay Commission is constituted roughly once every decade. The 7th Pay Commission, for instance, was set up in February 2014, submitted its report by November 2015, and was implemented from January 1, 2016. The 6th Pay Commission followed a comparable timeline, with its recommendations taking effect from January 2006.
Earlier reports indicated that the upcoming commission might consider a fitment factor of around 1.8x to determine the extent of basic pay revisions. However, the government has yet to reveal any details regarding the specific pay parameters or the members who will form the new commission.
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