Will 8th Pay Commission Cause Dramatic Jump To Pensions? Here’s What Experts Say

New Delhi: Amid increasing inflation, the Union Cabinet’s nod to the 8th Pay Commission on Thursday has come as a relief to central government employees and pensioners ahead of the Union Budget 2025. While the salaries of central government employees and pensioners will be revised, will it cause a dramatic jump to pensions? Here’s what experts opine:

Some experts also believe that if the fitment factor of 2.86 is approved in the 8th Pay Commission, the minimum salary and pension of government employees are expected to increase by 186%.

“The average pension hike should be in line with the hike in salaries. It is expected to be in a fitment factor of 2.5-2.8, thus increasing the pension from the current Rs 9,000 to anywhere between Rs 22,500 and Rs 25,200,” Krishnendu Chatterjee, Vice President at TeamLease, told Economic Times (ET).

However, it is practically not feasible to predict the hike in pensions based on the average pension hike percentages from previous pay commissions. But expert feel the 8th Pay Commission may provide an average pension hike in the range of 20% to 30%. The actual percentage increase will depend on various factors considered by the commission, said Ritika Nayyar, Partner at Singhania & Co, as quoted by India Today.

The past commissions, such as the 6th and 7th, had given pension increases matching salary hikes. After 7^th Pay Commission, a fitment factor of 2.57 was implement. This led to increase in pensions by 23-25%.