Is 8th Pay Commission applicable to pensioners? Benefits, pension hike doubts cleared here

3 min read | Updated on August 07, 2025, 14:06 IST

SUMMARY

Will the 8th Central Pay Commission benefits apply to pensioners? Yes, the 8th CPC will apply to Central Government pensioners. However, it does not apply to pensioners currently because the new pay panel has not yet been set up.

Central Government pensioners will benefit from 8th Pay Commission. Image source: Shutterstock

Is 8th Pay Commission applicable to pensioners? This is one of the top queries being asked by Central Government pensioners these days. More so because the delay in notification of the 8th Central Pay Commission (CPC) and a clear communication about its timelines have created a lot of confusion among retired Central Government employees.

Several bodies representing pensioners have recently asked the Government to provide clarity and expedite the 8th CPC set-up to curb increasing doubts among pensioners.

We covered the doubts and issues raised by Central Government pensioners earlier in this article, and this one too. That said, what is the answer to the query with which we started this article? You may ask.

Well, the answer is that the 8th Pay Commission will apply to Central Government pensioners. However, it does not apply to pensioners currently because the recommendations of the new pay panel have not been implemented yet. In fact, the Government has not yet formally notified or set up the 8th Pay Commission.

It may take another 1.5 to 2 years for the implementation of the 8th CPC recommendations (take a look at how much time the previous pay commissions took).

However, pensioners will benefit whenever the recommendations of the 8th Pay Commission are implemented by the Central Government.

What would be the benefits of 8th Pay Commission for pensioners?

Most likely, the pensioners may see an increase in their take-home pay due to the 8th Pay Commission. Other benefits of the new pay panel will be known only after it submits its recommendations.

The extent of the hike in pensions is likely to be similar to the hike in salaries of working employees, based on the fitment factor to be recommended by the 8th Pay Commission.

Various reports in recent weeks have predicted the expected increase in pay and pensions. According to a report by Ambit Capital, the impact of the 8th CPC on pensions will be similar to government salaries.

The pensioner's monthly basic pension could increase by the fitment factor, ranging from 1.8 and 2.15 to 2.46.

"There are 6.8mn Central government pensioners, higher than the number of active government employees. The impact of the 8th Pay recommendations on pensions will likely be similar to government salaries. Pensions comprise salaries and dearness allowance, but do not have HRA and travel allowance components. This means the basic pay component will increase by the fitment factor, while the dearness allowance will be reset to zero," the report says.

Another report by Kotak Institutional Equities expects the fitment factor to be 1.8, resulting in around 13% growth in real pay after accounting for inflation.