8th Pay Commission Update: Government Clarifies Timeline and Budget Plans
Changing salaries, pensions, and allowances for the approximately 12 million central government workers and retirees have been reviewed by the 8th Pay Commission. What we know about the timeline, budget planning, and next steps is presented here.
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The long-awaited and much discussed 8th Central Pay Commission (CPC) has been officially constituted, but the government has made it clear that there is no fixed timeline for the rollout of its recommendations yet.
Terms of Reference and Scope
During a Lok Sabha session, Minister of State for Finance Pankaj Chaudhary informed that the commission’s Terms of Reference (ToR) had been notified on November 3rd, 2025. These terms indicate the start of the review process for pay, pensions, and allowances of around 12 million serving and retired central government workers.
The ToR provides an 18-month period for the commission to submit its recommendations. Even though this gives a general idea of the timelines, the government has not specified any date for submission or implementation.
Learning from Previous Commissions
The government is taking into account the past experiences of the following pay commission:
7th CPC: Implementation took approximately 2.5 years from the date of formation
6th CPC: Took about 22 months
5th CPC: Had a duration of around 3.5 years
The timelines have been very different; hence predicting the exact time for the 8th CPC recommendations to be in force is quite difficult.
Implementation and Budget Considerations
MPs inquired if by January 1, 2026, the new pay scales could be in force, which has been the usual practice sometimes. Chaudhary did not provide any such confirmation but only said that the government considers implementation after the commission’s report is reviewed.
On the fiscal side, the minister mentioned that the Union Budget 2026–27 would most probably set aside some money for the 8th CPC, but only after the recommendations are made and accepted.
Impact on Employees and Pensioners
The 8th CPC will have an impact on around 5 million central government employees and 6.9 million pensioners. Chaudhary pointed out that the commission is going to utilize a disciplined methodology and will consider the concerns of the employees, such as those related to the perceived delay.
The commission has begun its work but the timelines remain unclear, thus the central employees and pensioners will be eagerly observing the developments during 2026 as the 18-month review period unfolds.
