8th Pay Commission: Will the New Pay Panel Start From 1 January 2026? Here’s What the Government Said

As the 10-year cycle of the Seventh Pay Commission comes to an end this month, speculation is growing rapidly among more than 50 lakh central government employees and around 69 lakh pensioners. Their biggest question is simple: Will the Eighth Pay Commission come into effect from 1 January 2026?

The government has now issued an important clarification on this widely discussed topic—one that directly impacts the salaries, pensions, and allowances of millions of beneficiaries across India.

Term of the Seventh Pay Commission Ends — What Happens Next?

The Seventh Pay Commission, which came into effect in 2016, was structured for a 10-year span. With its official tenure ending in December 2025, expectations around the next pay revision mechanism have clearly intensified.

The Centre has already constituted the Eighth Pay Commission (8th CPC) and notified its Terms of Reference (ToR). However, the most crucial question remains unanswered: From when will the new pay structure be implemented?

Government Statement in Parliament: No Final Decision Yet

Responding to a question in the Lok Sabha, Minister of State for Finance Pankaj Chaudhary stated that the date of implementation and financial provisions of the 8th Pay Commission will be decided later.

He confirmed that the ToR was officially notified on 3 November 2025, and the newly formed commission must submit its report within 18 months from the date of its constitution.

This clarification indicates that the long-anticipated implementation from 1 January 2026—a timeline many employees had hoped for—has not been approved by the government yet.

No Plan to Merge DA/DR With Basic Pay

There was widespread buzz that the government might merge Dearness Allowance (DA) for employees and Dearness Relief (DR) for pensioners with their basic pay under the new framework.

However, the Centre has denied any such proposal.

The minister clarified that DA and DR will continue to be revised every six months, based on inflation trends from the AICPI-IW index. Currently, both DA and DR stand at 55%, which was increased by 3% just before Diwali.

Why Has the Pay Commission Process Been Delayed?

Though the 8th CPC was announced in January 2025, it took nearly nine months to finalize the chairperson, panel members, and official ToR.

Employee unions have expressed concern that:

• The ToR does not explicitly mention the 69 lakh pensioners, unlike previous pay commissions.

• The government has not specified the date on which the new pay structure will be implemented.

• Several reports suggest that the rollout of the 8th Pay Commission may take up to two years.

This has added to growing uncertainty among employees eagerly awaiting clarity.

What to Expect From the Fitment Factor?

The fitment factor—which determines how much the basic salary will increase—is the most anticipated detail among employees.

Key expectations include:

• The fitment factor for the 8th CPC may be similar to the 7th CPC, according to the National Council (JCM) Staff Side.

• An Ambit Capital report estimates the fitment factor may range between 1.83 and 2.46.

If the upper range is approved, the minimum basic salary could rise from ₹18,000 to anywhere between ₹32,940 and ₹44,280.
This would translate into a near double increase in basic pay—though the final numbers will depend entirely on the government’s decision and the commission's recommendations.

What Employees Should Expect Next

The 8th Pay Commission will continue its review and is expected to prepare a comprehensive report covering:

• Revised pay structure

• Pension reforms

• Allowances and benefits

• Service conditions

Once submitted, the government will study the recommendations before final approval—meaning the process could extend well into 2026 or beyond.