8th Pay Commission Update: Government Explains Delay in Notification and When It Might Be Formed

Millions of government employees and pensioners across India are eagerly awaiting the formation of the 8th Pay Commission, which will determine future salary and pension revisions. While the government approved the commission’s formation in January 2025, the official notification is still pending. Now, the Ministry of Finance has revealed the reason for the delay.

Why the Notification Has Been Delayed

According to the Finance Ministry, the notification for the 8th Pay Commission is yet to be issued because the Terms of Reference (ToR) — which outline the commission’s scope and responsibilities — are still under review. Various stakeholders, including ministries and state governments, have been asked to submit their inputs before finalizing the terms.

In a written reply in the Rajya Sabha on August 12, 2025, Minister of State for Finance Pankaj Chaudhary explained that letters were sent on January 17 and February 17, 2025 to the Ministry of Defence, Ministry of Home Affairs, Department of Personnel and Training (DoPT), and all state governments requesting their feedback on the ToR. Inputs are still being received, and the notification will be issued at an “appropriate time” once the process is complete.

When Will the 8th Pay Commission Be Formed?

The minister clarified that only after the notification is issued will the chairman and members of the 8th Pay Commission be appointed. As for a specific timeline, Chaudhary maintained that the notification would be released at the right time, without committing to an exact date.

The delay means the formal constitution of the commission is still some distance away. However, once formed, it will take up the task of reviewing pay structures, pensions, allowances, and other benefits for central government employees and pensioners.

Background: Approval Was Granted in January 2025

In January 2025, the central government formally approved the setting up of the 8th Pay Commission. The commission’s primary responsibility will be to assess and recommend changes to the salary and pension structures of central government employees and pensioners, ensuring they remain fair and competitive. It will also review various allowances and facilities linked to government service.

When Will the New Pay Structure Take Effect?

The revised pay scales are expected to come into effect from January 1, 2026. However, given the time required to form the commission, conduct reviews, and prepare recommendations, the formal announcement of salary changes could take 1.5 to 2 years. Employees and pensioners are likely to receive the benefits retrospectively, along with arrears.

Fitment Factor in the 8th Pay Commission

The fitment factor — a multiplier used to calculate revised basic pay — plays a crucial role in determining salary hikes. In the 7th Pay Commission, the fitment factor was 2.57. Experts suggest that in the 8th Pay Commission, it could range between 1.92 and 2.86.

For example, if a government employee’s current basic salary is ₹30,000 and the fitment factor is set at 2.57, the new basic salary would rise to ₹77,100. A higher fitment factor would result in an even greater salary increase.

What This Means for Government Employees

While the wait for the official notification continues, employees and pensioners can expect that once the commission is in place, the recommendations will not only enhance salaries and pensions but also come with arrears from January 2026.

The government’s cautious approach, seeking feedback from all relevant stakeholders before issuing the notification, indicates that the commission’s mandate will be carefully crafted to address both employee expectations and fiscal realities.

Bottom Line: The 8th Pay Commission’s formation is inevitable but delayed due to ongoing consultations on its Terms of Reference. The new pay structure is likely to take effect from January 2026, with arrears provided, but the notification and appointments will only happen once stakeholder inputs are finalized.