8th Pay Commission Memebers: The Union Cabinet, led by Prime Minister Narendra Modi, has officially approved the Terms of Reference for the 8th Central Pay Commission (CPC). The move, announced on October 28, 2025, will directly benefit nearly 50 lakh Central Government employees and around 69 lakh pensioners, including personnel from the Defence Services.
The Central Government had first announced the formation of the 8th Pay Commission in January 2025 to review and recommend changes in salaries, pensions, and other benefits for its workforce.
According to the government, “The new CPC may consider, if necessary, sending interim reports on any of the matters as and when the recommendations are finalized.” This means that if certain recommendations are ready early, the panel may submit partial reports before the final one.
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Structure of the New Commission
The Ministry of Finance stated that the 8th CPC will function as a temporary body. It will include a Chairperson, one Part-Time Member, and a Member-Secretary. The government has chosen Justice Ranjana Prakash Desai, a former judge of the Supreme Court of India, to head the new pay commission. Pulak Ghosh, a professor at IIM Bangalore, will serve as the Part-Time Member, while Pankaj Jain, Secretary of Petroleum & Natural Gas, will act as the Member-Secretary.
The government expects the 8th CPC to complete its work and submit recommendations within 18 months. If the timeline of the 7th Pay Commission is any indication, which was approved within 6 months and implemented from January 1, 2016, the new pay revision could be expected to come into effect around late 2027.
What the Commission will Focus on?
The commission will examine the financial situation of the country before suggesting salary revisions. It will also study how the new pay changes might affect the State Governments since they usually follow similar structures with small changes. The report will take into account the emoluments and working conditions of employees in Central Public Sector Undertakings and the private sector. It will also review the growing cost of non-contributory pension schemes.
Currently employees and pensioners receive pay based on the 7th Pay Commission. The minimum basic salary for central employees stands at ₹18,000, while pensioners receive ₹9,000.
The maximum basic salary is ₹2,25,000, and top posts like the Cabinet Secretary get ₹2,50,000 per month. Under the 7th CPC, the fitment factor was fixed at 2.57, and the current Dearness Allowance (DA) and Dearness Relief (DR) stand at 58%.
For instance like with a 3% DA hike, employees with a basic salary of ₹18,000 earn ₹540 more, bringing their total minimum pay to ₹28,440 with 58% DA. Pensioners with a ₹9,000 base pension receive an additional ₹270, taking their total to ₹14,220.
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How the Fitment Factor Decides Salary?
The government may use the Aykroyd formula, created by Dr. Wallace Aykroyd, which calculates wages based on the minimum cost of living to decide. It looks at the expenses needed for food, clothing, housing,, basic essentials and other stuffs for an average worker.
if the fitment factor is fixed at 1.92, the new minimum basic salary could be around ₹34,560, while the minimum pension might rise to ₹17,280.
If it is set at 2.08, salaries could reach ₹37,440 and pensions ₹18,720. However, once the 8th CPC is implemented, the DA and DR will be reset to zero and start fresh again.
