More than 50 lakh central government employees and around 65 lakh pensioners are awaiting the implementation of the 8th Pay Commission, which is expected to revise salaries, allowances and pension benefits in line with inflation and rising living costs.
Constituted by Prime Minister Narendra Modi in January 2025, the commission has been tasked with submitting its recommendations within 18 months.
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As part of the exercise, the panel is consulting employee unions, pensioner associations, ministries and other stakeholders to gather inputs on pay structures, allowances and retirement benefits.
Here's a look at one of the key pension revision demands before the commission, the proposal for age-based pension enhancement, and what it could mean for retirees if accepted.
Age-based pension enhancement proposal
One of the prominent demands placed before the panel is the introduction of age-based pension enhancement. The proposal seeks higher pension payouts as retirees grow older, providing additional financial support to senior citizens facing rising healthcare and living expenses.
The proposal is yet to be approved by the Centre. But if it is implemented, age-wise benefit would look like this:
- 65 years - 70% of Last Pay Drawn
- 70 years - 75% of Last Pay Drawn
- 75 years - 80% of Last Pay Drawn
- 80 years - 85% of Last Pay Drawn
- 85 years - 90% of Last Pay Drawn
- 90 years and above - 100% of Last Pay Drawn
If accepted, the measure could significantly improve the financial security of elderly pensioners.
Other key pension demands
Employee and pensioner representatives have also sought a comprehensive overhaul of the pension framework. Major demands include:
- Raising the minimum pension to 67% of the Last Pay Drawn or the average emoluments received during the final 10 months of service.
- Revision of the fitment factor used in pension calculations.
- Review of the Dearness Relief (DR) structure and its integration with pension benefits.
- Expansion of family pension coverage and benefits.
Organisations including the National Council-Joint Consultative Machinery(NC-JCM), the Maharashtra Old Pension Organisation and the All India Defence Employees Federation have submitted detailed memoranda to the commission, seeking pension parity, restructuring and enhanced retirement benefits.
Timeline for 8th Pay Commission recommendations
The commission has invited suggestions and memoranda from stakeholders until June 15, 2026. Formal submissions began on March 5 and deadlines have been extended multiple times to allow wider participation.
Based on its current schedule, the 8th Pay Commission is expected to submit its final report around 18 months after its constitution by mid-2027. The recommendations will affect nearly 50 lakh serving central government employees and around 65 lakh pensioners, including defence and railway retirees.
However, going by previous pay commission cycles, implementation may take an additional two to three years after the report is submitted. As a result, any pay and pension revisions recommended in 2027 could be fully rolled out only by 2029 or 2030.
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