8th Pay Commission : If the fitment factor increases, the government exchequer will be hit hard; Experts warned

8th Pay Commission : The discussion regarding the 8th Central Pay Commission is gaining momentum. As the central employee unions have started to put forward their demands for wage revision, the impact of these demands is equally important. Experts warn that demand for more fitment factor by organizations is becoming significant. Managing this huge growth will be a big challenge for the government. At present, the government has to manage the expenses of 50.14 lakh central employees and approximately 69 lakh pensioners. What exactly is demand?

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According to experts, the real challenge before the government is not only the salary hike, but also the huge increase in pension contributions. Contributory schemes like the National Pension System and the Integrated Pension System already put a heavy burden on the government’s exchequer.

What exactly is fitment factor?

Fitment factor is a multiplier used by the government to revise the basic pay of central government employees while implementing the recommendations of the Pay Commission. In the previous, 7th Pay Commission, the minimum basic pay was fixed at ₹18,000 by applying a fitment factor of 2.57.

How much burden on the government now?

Approximately 32 to 33 lakh central government employees come under NPS. Employees contribute 10% of their basic pay and dearness allowance i.e. DA, while the central government contributes 14%. The government is paying approximately Rs 3,000 crore per month.
Under the new UPS system, the government’s contribution will increase to 18.5%. For example, if an employee’s basic salary is Rs 40,000, the government will have to pay an additional Rs 6,660 per month.
According to experts, even a mere 2% increase in fitment factor will increase government expenditure significantly.

The deadline for submission of proposals has been extended

The eighth Central Pay Commission has extended the deadline for submission of representations to stakeholders till June 15, 2026. This is the third extension of this deadline. Earlier, the deadline was fixed as April 30 and later May 31. This extended period will give employees unions, pensioners associations and government departments more time to submit their recommendations and objections. The commission will then begin the process of preparing its report.

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