When is the 8th Pay Commission salary and pension hikes coming? Latest updates to know

3 min read | Updated on July 15, 2025, 08:57 IST

SUMMARY

8th Pay Commission salary news updates: The Government is yet to formally notify the formation of the 8th Pay Commission and its members. The Terms of reference (ToR) of the 8th CPC have also not been finalised and notified.

8th Pay Commission may be implemented from FY27, says report. | Image source: Shutterstock

8th Pay Commission salary hike latest updates on July 14, 2025: Amid no clear update from the government about the timeline of the 8th Central Pay Commission (CPC), a report expects that the new pay panel is likely to be implemented from FY27, which is the financial year starting from April 1, 2026.

Here are the latest updates from the report and what's happening on the 8th CPC from the Government's side:

8th CPC from FY 27

The report by Ambit Capital says the 8th CPC will be implemented from FY27. It may lead to around 30-34% hike in Government employees' salaries, and also up to a 0.5% bump in the national GDP.

"In FY16, real GDP growth would have been ~200bps lower in the absence of the 7th Pay hikes. Our simulations suggest the stimulus from the 8th Pay should increase GDP growth by 30-50bps in FY27," the report said.

"The 8th Pay Commission, expected to be implemented in FY27, is anticipated to significantly boost government salaries and pensions by 30-34%, impacting around 11 million beneficiaries," it added.

You can read more about insights from the report about expected salaries here and here.

What's the government doing?

The Government is yet to formally notify the formation of the 8th panel and its members. The Terms of reference (ToR) of the 8th CPC have also not been finalised and notified.

Several appointments in the 8th CPC are also pending. The Government recently extended the last date to apply for four under-secretary posts in the 8th Pay Commission on a deputation basis. (Read more details here.)

Meanwhile, the Staff Side (JSM) and pensioners associations have been writing to the Government for the timely announcement of 8th CPC members, ToR, and implementation dates. The delay, they have said, is causing unrest and uncertainties among employees and pensioners, while giving rise to speculations.

Earlier, when the Government announced the decision to form the 8th CPC in January 2025, it was anticipated that the new pay panel's recommendations may be implemented from January 1, 2026. Though it is likely not to happen exactly from this date, the employees and pensioners can expect arrears from January 1, 2026, irrespective of when the new pay panel gets implemented.

What's the expected salary hike in 8th Pay Commission

It is estimated that the 8th Pay Commission may result in a minimum 14% real hike in pay (including Basic Pay + DA) for Central Government employees and pensioners. The maximum expected salary hike, according to the report, is 54%.

Further, it is projected that the 8th Pay Commission may recommend a fitment factor in the range of 1.83, 2.15, and 2.46. For someone with a basic salary of ₹50,000, a fitment factor of 1.83 would result in a total take-home pay of ₹1,15,297. Similarly, a fitment factor of 2.15 would reasult in a take-home pay of ₹1,36,203. The take-home pay may jump to ₹1,51,166 in case of 2.46 fitment factor.

However, a 54% hike in salary is very unlikely, as the Government would end up facing a lot of financial management challenges for approving such a big hike in salaries and pensions.

The 6th Pay Commission had recommended a 54% hike in real pay. But this is most likely not to happen in the 8th CPC. According to the report, although the government may consider a larger pay hike to boost consumption, a sharp 54% increase like the 6th Pay Commission is unlikely due to fiscal limitations.