“The 8th Pay Commission may consider, if necessary, sending interim reports on any of the matters as and when the recommendations are finalised,” the note stated.
The pay panel, while making its recommendations, will be required to keep in view the “economic conditions in the country and the need for fiscal prudence”.
The rollout of the last pay panel, which was the 7th Pay Commission, had added a fiscal burden of Rs 1.02 lakh crore in FY17. The impact on the exchequer is expected to be sharper when the 8th Pay Commission is implemented.
The 8th Pay Commission will also “need to ensure that adequate resources are available for developmental expenditure and welfare measures”, the Cabinet said.
The panel will also be required to take into account “the unfunded cost of non-contributory pension schemes”, and the likely impact of the “recommendations on the finances of the state governments”, the release added.
The state governments usually adopt the recommendations made by the central pay commissions with some modifications.
Furthermore, the 8th Pay Commission will also be required to consider the “prevailing emolument structure, benefits and working conditions available to employees of Central Public Sector Undertakings and private sector”.
Notably, the central pay commissions are constituted once in a decade to explore various issues of emoluments structure, retirement benefits and other service conditions of central government employees.
Usually, the recommendations of the pay commissions are implemented after a gap of every 10 years. “Going by this trend, the effect of the 8th central pay commission recommendations would normally be expected from Jan. 1, 2026,” the official release noted.
This suggests that even though the 8th Pay Commission will require 18 months to submit its report — and the same is expected to receive the Centre’s nod in three to nine months — the salary and pension hike will come into effect retrospectively. In such a scenario, the employees and pensioners will be paid arrears from Jan. 1, 2026.
This was also the case with the 7th Pay Commission, when the salaries were rolled out from July 2016, but arrears were paid from January 2016.
