8th Pay Commission Important Update: Is Modi government planning to set up pay panel before Bihar Assembly Elections? Key details here

The government has announced the formation of the 8th CPC but its chairman has not been appointed and the Terms of Reference (ToR) have not been finalised.

8th Pay Commission: The Modi government is likely to form the 8th Pay Commission Panel next week ahead of the Bihar Assembly elections, according to a Financial Express. To recall, the Prime Minister Narendra Modi-led Union Cabinet had approved the constitution of the 8th Pay Commission. Accordingly, the 8th Pay Commission will come into effect from January 1, 2026. However, the government has announced the formation of the 8th CPC but its chairman has not been appointed and the Terms of Reference (ToR) have not been finalised.

The report further added that the government has finalised the terms of reference (ToR), along with the chairman and members of the Commission, that will look after recommendations regarding pay and pension revision for central government staff.

Here are some of the key details:

• Over than 1.2 crore central government employees and pensioners are eagerly awaiting the formation of the 8th CPC
• The 8th Pay Commission is likely to significantly increase the salaries and pensions of the central government employees by 30-34 percent.
• The 7th Pay Commission had implemented a modest salary hike of 14 percent.
• It is expected that the 8th Pay Commission will announce a hike of 30-34 percent for salaries and pensions.
• The fitment factor is a multiplier used to revise the basic salary of government employees.
• According to experts, the fitment factor could be set between 1.83 and 2.46.
• Based on back-of-the-envelope calculations, depending on the salary growth seen over different pay commissions
• The range of fitment factors that the government could be looking at lies between 1.83 and 2.46, experts said.

The Union Cabinet recently approved increasing of dearness allowance and dearness relief for central government employees and pensioners. The DA and DR hike are effective from 01 July 2025 representing an increase of 3 percent over the existing rate of 55 percent of the Basic Pay/Pension to compensate against price rise, said a Cabinet note. The hike will benefit the 8th Pay Commission employees by directly increasing their monthly income.