The central government approved the 8th Central Pay Commission in January 2025, but the official notification is yet to be issued. Additionally, the Chairman and members of the new Pay Commission are yet to be finalized. The government stated that it is “actively consulting” state governments on the 8th Pay Commission and an announcement regarding the constitution of the panel is expected soon.
The Minister of State in the Finance Ministry, Pankaj Chaudhary, recently informed the Rajya Sabha that the official notification regarding the 8th Central Pay Commission would be issued in due course. He added that the Chairperson and members will be appointed once the notification is released.
What is Fitment Factor?
The fitment factor is a key metric used to determine salaries and pensions of government employees and pensioners. The government may consider adopting the Aykroyd formula, developed by Dr. Wallace Aykroyd, which calculates an ideal salary based on the minimum cost of living, accounting for essential expenses such as food, clothing, and housing.
How Fitment Factor is Calculated
Currently, the Dearness Allowance (DA) stands at 58%. With the implementation of the 8th Pay Commission, DA is expected to reach 60%, making the starting fitment factor 1.60 (based on a base of 1.00). Pay commissions typically recommend additional increases ranging from 15% to 30%.
For example, applying a 20% increase to the base factor of 1.60 results in an additional 0.32, giving a revised fitment factor of 1.92. A 30% increase would bring it to 2.08. The revised salary is calculated as:
Revised Salary = Basic Pay × Fitment Factor
Salary Hike Under 8th Pay Commission
Over 1 crore central government employees and pensioners are eagerly awaiting the official notification. The fitment factor will play a decisive role in determining the salary and pension hike for employees and pensioners.
