Prime Minister Narendra Modi on Thursday approved the formation of the Eighth Pay Commission to revise the salaries of central employees and allowances of pensioners. This step will benefit about 50 lakh central government employees and about 65 lakh pensioners. According to experts, under the 8th Pay Commission, the basic salary of central employees can be Rs 51,480 per month. Do you know what was the minimum salary of central employees under the Fourth Pay Commission 40 years ago in 1986?
According to the data of the Central Government, from the 4th Pay Commission to the estimated figures as per the recommendations of the 8th Pay Commission, there has been an increase of about 69 times in the salary of the central employees. Let us also tell you how many employees of the country were getting the benefit of Pay Commission 40 years ago and what was the minimum salary.
Government’s decision regarding 8th Vatan Commission
While giving information on Thursday, Information and Broadcasting Minister Ashwini Vaishnav had said that the Prime Minister has approved the Eighth Central Pay Commission for the Central Government employees. The chairman and two members of the commission will be appointed soon. The Seventh Pay Commission was constituted in 2014 and its recommendations came into effect from January 1, 2016. Its term is ending in 2026. The minister said that starting the process of constituting a new Pay Commission in 2025 will ensure that its recommendations are received and reviewed before the completion of the tenure of the Seventh Pay Commission.
PM @narendramodi Ji has approved the 8th Central Pay Commission for all Central Government employees. pic.twitter.com/4jl9Q5gFka
— Ashwini Vaishnaw (@AshwiniVaishnaw) January 16, 2025
How does the commission work?
The Pay Commission holds extensive consultations with the Central and State Governments and other concerned parties before making recommendations to the Government. Pay Commission plays an important role in deciding the salary structure, benefits and allowances for government employees. Most of the units owned by state governments implement the recommendations of the Commission. According to the information, this step will benefit about 50 lakh central government employees including those working in the defense sector. Besides, there will be an increase in the pension of about 65 lakh pensioners.
How many employees of Delhi will benefit?
This will benefit approximately four lakh employees in Delhi alone. These include defense and Delhi government employees. Assembly elections are to be held in Delhi on February 5, 2025. Sources said that generally, the salary of Delhi government employees increases with the Central Pay Commission. This will improve the quality of life of government employees as well as give significant impetus to consumption and economic growth. Under the Seventh Pay Commission, there was an increase of Rs 1 lakh crore in expenditure in the financial year 2016-17.
#WATCH Delhi | On Union Cabinet approving constitution of the 8th Pay Commission, National Federation of Indian Railwaymen (NFIR) President Guman Singh says, “In India, pay revision of central government employees is done every 10 years. Under this, the government has approved pic.twitter.com/IBdyjtDD2B
— ANI (@ANI) January 17, 2025
What can be the minimum salary?
Rohitashv Sinha, Partner, Advocates and Attorney, King Stubb & Kasiva, says in the media report that in most cases, the Pay Commission is established every 10 years to assess the salaries of central government employees and make changes in them. The last pay commission, i.e. 7th pay, came into effect in January 2016. In which the minimum basic salary was increased from Rs 7000 to Rs 18,000 by using fitment factor 2.57.
It is believed that in the 8th Pay Commission, there will be a staggering 186 percent increase in basic salary, due to which the minimum basic salary can be Rs 51,480 per month. He said that it seems that the fitment factor for the 8th Pay Commission is 2.86. The pay changes are likely to be implemented through the Central Civil Services (Revised Pay) Rules, 2025. This may also lead to increase in pension and other retirement benefits like EPF, gratuity etc.
How to calculate salary from fitment factor?
How can Central Government employees calculate the salary hike based on the fitment factor announced by the 8th Pay Commission? Let us try to understand this with an example. Suppose your basic salary is currently Rs 40,000 per month and the 8th Pay Commission has recommended a fitment factor of 2.5. Based on this, your basic salary will increase to Rs 1 lakh per month. However, dearness allowance will not be given in the initial period because usually the Pay Commission recommends it. As per the recommendations of the Pay Commission, dearness allowance is usually added to the salary in future years. According to the recommendations of the Pay Commission, there may be changes in other allowances also.
Recommendations made by previous pay commissions
7th Pay Commission (February, 2014 to November, 2016)
chairman : Justice AK Mathur
Minimum salary:Increased to Rs 18,000 per month.
Maximum salary:Rs 2,50,000 per month.
Special Recommendation:A new pay matrix was recommended in place of the grade pay system.
Important thing :Attention was given to perks and work-life balance.
Beneficiary: More than one crore (including pensioners)
Sixth Pay Commission (October, 2006 to March, 2008)
Chairman: Justice B.N. Sri Krishna
Important thing :Pay Bands and Grade Pay Introduced
Minimum Wage: Rs 7,000 per month.
Maximum Salary: Rs 80,000 per month.
Incentive: Emphasis on performance related incentives.
Beneficiary : about 60 lakh employees
5th Pay Commission (April, 1994 to January, 1997)
Chairman: Justice S. Ratnavel Pandian
Minimum salary : Rs 2,550 per month was recommended.
Important thing : Suggested to reduce the number of pay scales and focus on modernizing government offices.
Beneficiary: about 40 lakh employees
Fourth Pay Commission (September, 1983 to December, 1986)
Chairman: PN. Singhal
Minimum salary : Rs 750 per month was recommended.
Important thing : Attention was paid to reducing disparities in pay across ranks. Performance linked salary structure was introduced.
Beneficiary: More than 35 lakh employees.
69 times increase in 40 years
If the minimum basic salary under the 8th Pay Commission becomes Rs 51,480, then the salary of central employees will increase by 69 times in the last 40 years. According to the data, the Fourth Pay Commission was implemented 40 years ago i.e. in 1986. In which the minimum basic salary was Rs 750. This means that from then till the 8th Pay Commission, the minimum basic salary would have increased by 6,764 percent. This means that the basic salary of central employees would have increased by 69 times from the 4th Pay Commission to the 8th Pay Commission.
Why is Pay Commission formed?
Generally, every 10 years the Central Government constitutes a Pay Commission to revise the salaries of its employees. Seven pay commissions have been constituted since 1947. The Pay Commission also recommends the amendment in the formula of dearness allowance and dearness relief to the central government employees and pensioners for the purpose of compensating them for inflation. State governments also revise the salaries of their employees on the lines of the Central Pay Commission.
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