News Desk
09 November 2025, 05:30 PM IST
The newly notified Terms of Reference for the 8th Pay Commission have raised concerns as pensioners claim that 69 lakh Central Government retirees have been left out of its review. Experts and employee bodies urge the government to revise the Terms of Reference to ensure fair pay and pension revisions.
Representational image
The Centre’s notification of the Terms of Reference for the 8th Central Pay Commission has triggered unrest among employees and pensioners, who claim the new pay panel has excluded nearly 69 lakh pensioners and family pensioners from its mandate.
The All India Defence Employees’ Federation (AIDEF) has written to Finance Minister Nirmala Sitharaman, alleging that the newly issued Terms of Reference omit critical clauses on pension revision that were included in the 7th Pay Commission, leaving millions of retired government staff outside the scope of review.
Pensioners left out
AIDEF says the omission of pension revision from the 8th CPC’s scope is “most unfortunate and unjustified”.
Media quoted the federation as stating, “Those who have given their sweat and blood to the nation for decades are now being ignored in the fag end of their lives.”
In the 7th pay commission, the terms of reference explicitly instructed the panel to examine “the structure of pension and other retirement benefits, including revision of pension for those who retired before implementation”. That clause is missing from the 8th pay commission document — effectively keeping pensioners out of any revision exercise.
What the Union wants
AIDEF has urged the government to amend the terms of reference to:
Include pensioners and family pensioners within the 8th pay commission’s scope.
Specify January 1, 2026 as the date from which the new pay and pension structure should take effect.
Restore commuted pension after 11 years (instead of 15).
Introduce a 5% pension hike every five years after retirement, as recommended by a Parliamentary Standing Committee.
The federation also noted that the 8th pay commission’s clause on emoluments is narrower than the 7th pay commission’s, missing references to stakeholder expectations and capacity building that earlier commissions emphasised.
Why inflation data matters
Experts say the success of the 8th pay commission will depend on how accurately India measures inflation — a key factor for calculating the Dearness Allowance (DA) and setting fair pay revisions.
Currently, housing inflation is estimated using House Rent Allowance (HRA) and licence fees of government housing — figures not linked to real market rents. This method often distorts Consumer Price Index data, making inflation appear higher or lower than it really is.
In 2017, after the 7th pay commission revised HRA rates, official housing inflation jumped from 4.7% to 8.45%, even though actual rents barely moved — showing how flawed inflation inputs can skew salary adjustments.
Accurate data is therefore essential to ensure fair wage hikes without placing extra burden on public finances.
The road ahead
The 8th Pay Commission, headed by Justice Ranjana Desai, will submit its report within 18 months. Its recommendations will decide the new structure for salaries, pensions and allowances of Central Government employees.
For now, employee unions insist that without correcting the terms of reference omissions and ensuring realistic inflation measurement, the 8th pay commission risks failing the very people it was meant to benefit.
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