Sitharaman Clarifies On Pension Parity, Highlights Centre's Nod For 8th Pay Commission

Finance Minister Nirmala Sitharaman clarified in the Rajya Sabha on Thursday that the government is committed towards pension parity for retired government employees, and also recalled the decision taken in January 2025 to form the 8th Pay Commission for revision of pensions and salaries.

"Prime Minister Narendra Modi had in January 2025 approved the establishment of the 8th Central Pay Commission to revise the salaries and benefits of Central Government employees and pensioners," she said.

Sitharaman said that the validation rules, which are part of the Finance Bill cleared by the Lok Sabha, ensure that there is no discrimination among the retired central government employees over the payment of pensions.

All central government pensioners who had retired before January 1, 2016 are receiving pension at par with employees who retired after January 1, 2016, she said.

"The validation rules do not, in any way, change or alter the existing pensions so fixed of existing civil pensioners from the present stage," the finance minister said.

The validation rules also do not affect Defense Pensioners in any way as they are covered by separate rules, she noted.

"It is not an amendment to any pension Rules or instructions but only a reaffirmation of the same w.e.f. 1st June, 1972, i.e. the date the CCS (Pension) Rules were promulgated," Sitharaman said.

On her official social media handle, Sitharaman explained that the 6th Central Pay Commission made a distinction between the retirees of pre-January 1, 2006 and those of post-January 1, 2006 periods.

"The then-Government (Congress-led UPA) had accepted the recommendations of 6th Central Pay Commission and decided that there will be a distinction between pensioners with reference to the cut-off date of 1.1.2006," she wrote.

Sitharaman added that the 7th Central Pay Commission, whose recommendations were accepted during the first tenure of the Narendra Modi-led government, brought in "parity between pre 1.1.2016 and post 1.1.2016 Pensioners".

The clarification comes on the heels of the formation of 8th Pay Commission. The panel, which will comprise a chairperson and at least two members, is expected to be formed in the next few days. It will hold deliberations with various stakeholders before submitting its report on the fitment factor and other modalities for the revision of salaries and pensions of central government employees and retirees, respectively.