8th Pay Commission May Raise Govt Employees' Salaries By Rs 14,000-19,000, Says Report. Check Details

The financial services firm estimated that the pay revision will benefit approximately 50 lakh central government employees and 65 lakh pensioners

The 7th Pay Commission, implemented in 2016, cost the government Rs 1.02 lakh crore

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Central government employees could see a salary increase ranging from Rs 14,000 to Rs 19,000 per month following the implementation of the 8th Pay Commission, according to a report released by Goldman Sachs on Tuesday.

The financial services firm estimated that the pay revision will benefit approximately 50 lakh central government employees and 65 lakh pensioners. The formation of the 8th Pay Commission is anticipated to occur in April, with its recommendations likely to be implemented by the year 2026 or 2027.

Analyses Of Various Budget Allocations

Goldman Sachs analysed various budget allocations to estimate potential salary hikes. Currently, the median monthly salary of a central government employee stands at Rs 1 lakh before tax. Based on different budget scenarios, the firm projected potential salary increases:

• If the government allocates Rs 1.75 lakh crore for the 8th Pay Commission, with half of this amount used for salary revision and the rest for pensions, the median salary could rise to Rs 1,14,600 per month, states the report.
  
  
• With an allocation of Rs 2 lakh crore, salaries may increase to Rs 1,16,700 per month.
  
  
• If the allocation reaches Rs 2.25 lakh crore, the median salary could rise to Rs 1,18,800 per month.
  
  

The 7th Pay Commission, implemented in 2016, cost the government Rs 1.02 lakh crore. Although the revised salaries and pensions were applied retroactively from January 2016, they were officially rolled out in July 2016, impacting the financial year 2016-17.

Once formed, the 8th Pay Commission will engage with various stakeholders to decide on the fitment factor and other aspects of salary and pension revisions. Employee unions have indicated that they may demand a fitment factor of 2.57 or higher, similar to the one recommended under the 7th Pay Commission.