Cabinet Nod for 8th Pay Commission Implementation

On January 16, 2025, Prime Minister Narendra Modi with his cabinet approved the formation of the 8th Central Pay Commission (CPC) for central government employees. This decision, announced by Union Minister Ashwini Vaishnaw, aims to revise the salaries and allowances of central government employees, along with pensioners. The 8th Pay Commission will work to address the financial needs of the workforce and ensure a timely revision of compensation structures. This step comes ahead of the 7th Pay Commission’s term, which will conclude in 2026, allowing sufficient time to implement the changes before the term ends.

Key Highlights

Objective

• To revise the salaries, allowances, and pensions of central government employees.

Approval

• Approved by Prime Minister Narendra Modi and its cabinet on January 16, 2025.
• Union Minister Ashwini Vaishnaw made the announcement.

Establishment of the 8th Pay Commission

• Will address the revision of pay scales and allowances for central government employees and pensioners.

Timeline

• The 7th Pay Commission was established in 2016, and its term ends in 2026.
• The 8th Pay Commission is set up well in advance to ensure adequate time for reviewing and finalizing its recommendations.

Government Commitment

• The establishment of the 8th Pay Commission reflects the government’s commitment to addressing the financial needs of government employees in a timely manner.

Chairman and Members

• The Chairman and two members for the 8th Pay Commission will be appointed soon.

Importance of Pay Commission

• The Pay Commission plays a significant role in determining salary structures, pension payments, and allowances for central government employees.

7th Pay Commission (2016-2026)

• Fitment factor of 2.57 was decided upon, leading to an increase in minimum pay from ₹7,000 to ₹18,000.
• Pension increases from ₹3,500 to ₹9,000.
• Maximum salary revised to ₹2,50,000 and maximum pension to ₹1,25,000.

Coverage

• The pay commission applies to all central government employees in civil services and those paid from the consolidated fund of India.
• Excludes public sector undertakings (PSUs), autonomous bodies, and Gramin Dak Sevaks.

Summary/Static	Details
Why in the news?	Cabinet Nod for 8th Pay Commission Implementation
Purpose of the 8th Pay Commission	Revision of salaries, allowances, and pensions for central government employees and pensioners
Last Pay Commission	7th Pay Commission (2016-2026)
Chairman and Members	To be appointed soon
7th Pay Commission Highlights	Fitment factor of 2.57, Minimum salary: ₹18,000, Minimum pension: ₹9,000, Maximum salary: ₹2,50,000, Maximum pension: ₹1,25,000
Coverage	Central government employees; excludes PSU and autonomous body employees
Key Focus Areas	Salary and allowance revisions, pension decisions
Commitment to Timeliness	Proactive establishment of 8th Pay Commission before the end of 7th Pay Commission’s term in 2026
Government’s Approach	Regular review and revision of compensation structures