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8th Pay Commission: The 8th Pay Commission report may take 15-18 months to prepare, delaying salary increases. This has increased uncertainty among employees. The government will face increased financial pressure in FY 2028 when large arrears will have to be paid.

8th Pay Commission: The good news that millions of central government employees and pensioners were waiting for since the beginning of 2026 seems to be delayed for now. According to the established 10-year pattern, the 8th Pay Commission was expected to be implemented from January 2026, but so far neither the commission's report has been released nor has there been any salary increase. This makes it clear that a delay in the implementation of the 8th Pay Commission is certain. Now, a report by the rating agency ICRA has not only increased the concerns of the employees but has also highlighted it as a major financial risk for the government.

Why has the 8th Pay Commission been delayed?

The 8th Pay Commission has been a topic of discussion among central government employees for a long time, but now the reasons for its delay are becoming clear. According to the rating agency ICRA, the Pay Commission report may take another 15 to 18 months to prepare. Therefore, the possibility of an immediate salary revision is very low. A report by the Financial Express also indicates that the process is bound to take time.

Looking at the timeline so far, and considering the history of pay commissions, a new commission is usually implemented every 10 years. The 7th Pay Commission was implemented from January 1, 2016, while the 8th Pay Commission was expected to be implemented from January 1, 2026. However, due to delays in the preparation of the report and the implementation of the recommendations, this timeline seems to be shifting further.

When will the real impact be seen?

According to ICRA's assessment, the financial impact of the 8th Pay Commission will not be seen immediately, but in FY 2028. This means that the burden of salaries and pensions on the government will remain limited for now, but as soon as the commission's recommendations are implemented, a sharp increase in expenditure will be seen. ICRA believes that the government may implement the 8th Pay Commission retrospectively from January 1, 2026. If this happens, employees may have to be paid arrears for 15 months or more in one go.

Salary expenses could jump by 40-50%

According to the report, the central government's salary expenditure could increase by 40 to 50 percent in FY 2028. This increase could prove to be a major challenge for budget balance and fiscal discipline. ICRA expects the government to increase capital expenditure in FY 2027 itself to manage the pressure from the upcoming pay commission.  According to estimates, capital expenditure could increase by about 14%, and total expenditure could reach ₹13.1 lakh crore. This will boost infrastructure and development projects and help balance the rising salary expenses.

Why is the 8th Pay Commission so important?

ICRA's report clearly indicates that the 8th Pay Commission is no longer limited to just salary increases. This commission could have a profound impact on the direction of government spending, several upcoming Union Budgets, and the country's overall financial strategy. This is why the 8th Pay Commission is considered extremely important for both the government and the employees.