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New Delhi, October 26: The Union Cabinet has officially approved the 8th Central Pay Commission (CPC) in January 2025, coming nearly a decade after the 7th CPC of 2016. The revised pay structure will take effect from January 1, 2026, benefiting around 48.62 lakh active employees and 67.85 lakh pensioners across India. The decision marks a significant move to realign government pay, allowances, and pensions with inflation and rising living costs. With the new pay revision, the government aims to ensure fair compensation, financial stability, and parity in pay scales across departments and cadres, addressing long-standing demands from employees’ unions and retirees. 8th Pay Commission Update: Central Govt Employees May Get 17-Month Arrears as Salary Revision Likely to Be Implemented Retrospectively From January 2026. Key Salary and Allowance Revisions A fitment factor of 2.28 is proposed, which is expected to raise the minimum basic salary by 34.1%, from INR 18,000 to INR 41,000. The Dearness Allowance (DA), projected to reach 70% by early 2026, will be merged with the base pay for a unified salary structure. Employees will also receive enhanced House Rent Allowance (HRA) based on city category and Travel Allowance (TA)depending on grade and location. 8th Pay Commission: Fitment Factor Set to Determine Salaries and Pensions for Central Government Employees and Pensioners, Know How. Pension and Fitment Factor Insights Pensioners are set to gain significantly as well. The minimum pension could increase from INR 9,000 to INR 20,500, thanks to the proposed fitment factor of 3.00 — higher than the 6th CPC’s 1.86 and the 7th CPC’s 2.57. This adjustment is expected to bring an average 20% overall salary and pension increase. The 8th CPC pay matrix introduces a structured system for transparency and fairness. Entry-level employees (Level 1) will see their pay rise from INR 18,000 to INT 21,600, while top-level officers (Level 18) could see salaries increase from INR 2.5 lakh to INR 3 lakh.
