The commission will be headed by former Supreme Court judge Ranjana Prakash Desai and will have petroleum secretary Pankaj Jain as member secretary and IIM Bangalore professor Pulak Ghosh as part-time member. It will submit its report within 18 months.
Information and broadcasting minister Ashwini Vaishnaw said the final date of implementation will be decided after the interim report is submitted, but added that it is “mostly expected to be January 1, 2026”.
Pay commission recommendations are usually implemented with retrospective effect.
The panel will make recommendations after considering economic conditions and fiscal prudence, availability of resources and pension liabilities under non-contributory schemes as well as the financial impact on state governments.
The cabinet move formally kick-started the process of rate revision. The Centre had announced the formation of the eighth pay commission in January.The quantum of salary and pension hike will be based on the fitment factor, which is yet to be determined.
The seventh pay commission used a 2.57 fitment factor, resulting in a 157% increase in the minimum basic pay to ₹18,000 per month from ₹7,000.
If a similar fitment factor is used by the eighth pay commission, the minimum salary could rise to ₹46,260 per month.
Various central staff unions are demanding that a fitment factor of at least 2.83 be used.
Pay commissions are usually constituted every decade. The seventh pay commission, set up in 2014, submitted its report in 2015 and its recommendations were implemented from January 1, 2016. The sixth pay commission followed a similar timeline with effect from January 2006.
The eight pay commission is expected to complete its work by mid-2027, after which the government will take a decision on implementation of its recommendations.