Daijiworld Media Network - New Delhi
New Delhi, Oct 28: The Union Cabinet, chaired by Prime Minister Narendra Modi, on Tuesday approved the Terms of Reference (ToR) for the 8th Central Pay Commission (CPC), paving the way for a fresh review of salaries and pensions for Central government employees and retirees.
The 8th CPC will be a temporary body comprising a Chairperson, a part-time Member, and a Member-Secretary, and is mandated to submit its recommendations within 18 months of its constitution. If required, the Commission may issue interim reports on specific matters as it finalizes its proposals.
According to the approved terms, the Commission will consider several key factors while framing its recommendations, including:
• The overall economic conditions of the country and the need for fiscal discipline.
• Ensuring sufficient resources for developmental and welfare programmes.
• Addressing the unfunded liabilities of non-contributory pension schemes.
• Assessing the impact on State finances, as many States adopt CPC recommendations with modifications.
• Reviewing salary structures and benefits of employees in Central PSUs and the private sector for parity.
The Central Pay Commissions are set up periodically to examine the pay structure, retirement benefits, and service conditions of Central government employees and to recommend necessary revisions. Traditionally, a new Pay Commission’s recommendations are implemented roughly every ten years, with the 8th CPC’s impact expected to begin from January 1, 2026.
The government had announced the formation of the 8th Central Pay Commission in January 2025, and the move is projected to benefit around 50 lakh employees and over 65 lakh pensioners, including defence personnel.
Historically, the 7th Pay Commission, established by the Manmohan Singh government in 2014, submitted its report in 2015, and its recommendations were implemented from January 2016. The upcoming 8th CPC is expected to continue this decadal pattern, shaping the future pay and pension structure for millions of government employees across India.