8th Pay Commission: Big salary hike likely for central govt employees

The central government has approved the implementation of the 8th Pay Commission, significantly boosting the salaries and pensions of over one crore central government employees and pensioners from January 1, 2026.

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8th Pay Commission Update

The 8th Pay Commission's approval will significantly impact salaries and pensions. The fitment factor increase to 2.86 will substantially revise the salary structure. The minimum basic salary could rise to ₹51,480, and minimum pensions to ₹25,740. This reform ensures fair compensation, reflecting changing living costs.

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Central Government Employees

The fitment factor increase to 2.86 in the 8th Pay Commission will significantly raise the basic salary, benefiting current and retired employees. This will also impact allowances like HRA and TA, based on location and job type. These updates aim to provide better financial stability, reflecting changing living costs.

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7th Pay Commission

Besides basic pay, allowances like HRA and TA will be revised based on location (urban, semi-urban, or rural). Even within the same pay commission, allowances may vary. Deductions like NPS and CGHS contributions will also increase proportionally with the salary hike. The increased basic pay means higher employee and employer contributions, boosting retirement savings and health benefits.

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New Salary of Government Employees

The 8th Pay Commission will impact take-home salaries across pay grades. For Pay Grade 2000 (Level 3), the basic salary could reach Rs 57,456, with a gross salary of Rs 74,845 and net salary of Rs 68,849. For higher grades like Pay Grade 6600 (Level 11), the basic could reach Rs 184,452, with a gross of Rs 235,920 and a net of Rs 216,825. These figures are indicative and subject to change.

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Pension Increase

The revised pay scales will boost employee morale, improve public sector performance, and attract new talent. The increased salaries and pensions will boost spending power, contributing to economic growth through consumption. As 2026 approaches, the focus is on the detailed recommendations and government decisions.