8Th Pay Commission: New Fitment Factor Explained, Salary May Rise Big

The 8th Pay Commission, led by Justice Ranjana Desai, has started its work. All eyes are on the fitment factor, with recommendations likely to be implemented from 2027.

8th Pay Commission Updates:After the official notification of the Terms of Reference (TOR), the 8th Pay Commission, led by Justice Ranjana Desai, has begun its work. The recommendations will directly impact the finances of over 50 lakh central employees and 6.5 lakh pensioners.

All eyes are on the fitment factor, as it's the basis for calculating salary and pension hikes. The final decision will be made after the Union Cabinet's approval. The commission is expected to submit its report within 18 months, covering everything from the fitment factor to the basic pay structure.

Inflation, cost of living, and the country's financial situation are considered when setting the fitment factor. In the 7th Pay Commission, it was 2.57, and it's expected to be around the same level for the 8th Pay Commission.

An Ambit Capital report in July estimated the fitment factor could be between 1.83 and 2.46. For a basic salary of Rs 18,000, a 1.83 factor would raise it to Rs 39,940, while a 2.46 factor would make it Rs 44,280. This suggests a significant salary hike is possible.

The 8th Pay Commission was announced early this year, but its formal declaration was delayed by about ten months. With an 18-month deadline, implementation from next year is tough. It's more likely to start in 2027, with arrears added to salaries or pensions.

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