8th Pay Commission Implementation: The Latest on Salary Increases, Pension Increases, and DA

The 8th Central Pay Commission (8th CPC) will probably change the pay and pensions of more than 50 lakh central government workers and about 69 lakh pensioners. However, the date of implementation and funding details are still being worked out.

The commission will decide how much to raise salaries and pensions based on the fitment factor, which is a number that affects them.

Pankaj Chaudhary, the Union Minister of State for Finance, told the Lok Sabha not long ago that the 8th CPC was formed on November 3, 2025, with Justice Ranjan Prabha Desai as Chairperson, Prof Pulak Ghosh as a Part-time Member, and Pankaj Jain as Member-Secretary.

The commission is supposed to give its suggestions within 18 months.

The 7th Pay Commission's term ends on December 31, 2025, but new payments will probably start on January 1, 2026.

Once the recommendations are approved, government workers and retirees should get back pay, but it could take up to two years for this to happen.

A key clarification from the Finance Ministry confirmed that there is currently no proposal to merge Dearness Allowance (DA) or Dearness Relief (DR) with basic pay, ending speculation on social media and among employee unions.

DA and DR will keep going up every six months based on the All India Consumer Price Index for Industrial Workers (AICPI-IW).

The fitment factor will decide how much pay and pension increases will happen.

For instance, a factor of 2.15 could more than double the basic salary, which would raise benefits like HRA, pensions, and other benefits that are based on the basic pay.

Policy talks say that the 8th CPC's suggestions could be put into action in fiscal year 2028, with back pay going back to January 1, 2026, for up to five quarters.

Experts have pointed out possible financial effects, saying that the total payment to the central and state governments could be more than ₹4 lakh crore. If arrears are included, the total could rise to around ₹9 lakh crore.

The government has made it clear that there will be enough money in the budget to carry out the commission's recommendations once they are finalized. This will strike a balance between employee benefits and fiscal responsibility.