Good news for govt employees! Union cabinet approves terms of reference of 8th Pay Commission

Former Supreme Court judge Ranjana Prakash Desai will chair the Commission.

The union cabinet on Tuesday approved the Terms of Reference of the 8th Pay Commission, which will revise the salaries of nearly 50 lakh employees of the central government. Former Supreme Court judge Ranjana Prakash Desai will head the Commission as president. The panel will submit its recommendations within 18 months and is likely to come into force from January 1, 2026, Information and Broadcasting Minister Ashwini Vaishnaw said at a cabinet briefing on Tuesday.

According to the official statement, the 8th Central Pay Commission will function as an interim body comprising the chairman, one part-time member and one member-secretary. The statement said that the panel will take into account the current economic conditions in the country and the need for fiscal prudence when formulating its recommendations. It will also consider the need to provide adequate resources for development expenditure and welfare measures, the unfunded cost of non-contributory pension schemes, and the likely fiscal consequences for state governments that often adopt similar recommendations with modifications. Additionally, the Commission will examine the current wage structure, benefits and working conditions of employees in Central Public Sector Undertakings (PSUs) and private sector.

Central Pay Commissions are formed periodically to examine issues related to salaries, retirement rights and conditions of service of central government employees and to recommend necessary changes. Generally, the recommendations of Pay Commissions are implemented after a break of every ten years. The recommendations of the 7th Pay Commission were implemented on January 1, 2016, but the union cabinet approved the implementation of this recommendation on June 29 of the same year. The government had in January this year announced the establishment of the 8th Central Pay Commission to make and recommend revisions in the salaries and benefits of central government employees and continue the established process of periodic review and reform in public sector compensation.

Union Minister Vaishnaw said on Tuesday: “This is a very important decision. In-principle approval was given for setting up of the 8th Pay Commission in January and in such a short period of time, the 8th Central Pay Commission was also constituted.”

(With inputs from news agency ANI).