New Delhi. For central government employees and pensioners, Pay Commission is not just a matter of salary increase, but it is a big decision related to their financial security, future planning and retirement stability. Discussions are intense regarding the 8th Pay Commission and it is believed that through this, extensive changes can be seen in the pay structure. Let us understand the key points that can decide the direction of your salary and pension.
1. Tentative date of implementation
It is expected that the new recommendations may become effective from January 1, 2026. The tenure of the current 7th Pay Commission is considered to be till 31 December 2025, in such a situation the new structure can be implemented from 2026. However, the final decision will depend on the government’s announcement.
2. Fitment factor will be a gamechanger
Fitment factor is the multiplier by which the existing basic pay is converted into the new pay. Last time it was 2.57. This time if it is fixed between 2.28 to 3.00, then a significant increase in the basic salary of the employees is possible. This factor is considered the backbone of the entire salary structure.
3. Increase in minimum basic salary
If the fitment factor is kept high, the current minimum basic pay may increase from ₹18,000 to more than ₹40,000. This increase can directly prove to be a big relief for lower pay level employees.
4. Relief to pensioners
The minimum pension of retired employees may also be revised. Currently it is ₹9,000, but it is expected to increase significantly under the new salary structure. This will help in balancing the inflationary pressure to some extent.
5. Overall increase in total salary
Not only the basic pay, but also the total salary (gross salary) is being estimated to increase by 20% to 35%. Employees from pay level 1 to 18 can get its benefits at different levels.
6. Revision of allowances
The increase in basic salary will also affect Dearness Allowance (DA), House Rent Allowance (HRA) and Transport Allowance (TA). These allowances are usually linked to basic pay or inflation rate, so they can also be calculated afresh in the new structure.
7. Possible merger of DA
There is talk that by the time the new pay commission comes into effect, DA may reach around 60%. In such a situation, there is a possibility that the existing DA should be absorbed into the basic salary and then new DA calculation should be started from zero. This may make the initial basic pay appear higher.
8. Reforms in pension schemes
In the new system, changes or improvements in the structure of National Pension System (NPS) and Unified Pension Scheme (UPS) can also be considered. Emphasis can be laid on strengthening minimum pension security, especially for employees with long service.
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