Pay Commission has task cut out

Approving the Terms of Reference (ToR) for the Eighth Pay Commission, the government has set in motion a huge fiscal exercise that envisages salary increases for about 1.2 crore central employees and pensioners.

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The commission, to be headed by retired Supreme Court judge Justice Ranjana Desai, also includes IIM Bangalore professor Pulak Ghosh as a part-time member and petroleum secretary Sanjay Jain as member-secretary. It will submit its recommendations in 18 months, that is by mid-2027, but the upgraded salaries and pensions are likely to kick in with retrospective effect from January 1, 2026. The Seventh Pay Commission was constituted in 2014, and its recommendations took effect from January 1, 2016. The commission faces a tough balancing act between fiscal prudence and employees' expectations. It has to evaluate the country's economic growth and inflation, as a stable economy will give it more room to hike pay. It also has to keep in mind that funds remain available for developmental projects and The 8th Pay Commission faces a tough bala