The Prime Minister Narendra Modi-led Union Cabinet has approved the 8th Pay Commission, which will take effect from 1 January 2026. Central government employees are anticipating salary hikes, while pensioners expect revisions to their pensions.<\/p>\n
The Commission is expected to revise salaries, pensions, and allowances of both serving and retired personnel of the central government.<\/p>\n
Also Read | 8th Pay Commission from 1 January: Will your pay increase right away?<\/a><\/p>\n As government staff await its implementation, here’s a detailed look at how the 8th Pay Commission <\/a>will affect pensioners, whether there will be a pension hike and what fitment factor <\/a>is likely.<\/p>\n Will pensions increase?<\/p>\n There is no officially announced pension hike percentage yet. The increase will depend on the fitment factor, a multiplier used to re-fix basic pay and pension, and on the new pay matrix recommended by the Commission, said Anirban Ghatak, Assistant Professor of Economics at the Indian Institute of Management, Kozhikode.<\/p>\n Some experts anticipate that the minimum pension amount could rise to around \u20b920,000, compared to \u20b99,000 in the 7th Pay Commission, if the fitment factor is set between 2.3 and 2.8. This would imply a 100-190% increase, said Monika Rajpoot, Assistant Professor of Economics, Motilal Nehru College, University of Delhi.<\/p>\n \u201cPensioners are expecting to be granted an identical uniform fitment factor as an active member, thereby promoting equity across all categories,\u201d she added.<\/p>\n Also Read | Will DA be added to basic pay under 8th Pay Commission? FinMin clarifies<\/a><\/p>\n Family pensioners are also expected to benefit. \u201cUnder the existing rules, family pension is typically 30% of basic; however, under the 8th Pay Commission, the fitment factor is applied to basic, thus the absolute family pension increases,\u201d Rajpoot added.<\/p>\n How does fitment factor affect pensions?<\/p>\n Experts outline possible scenarios.<\/p>\n \u2014 If the fitment factor is 1.92, then basic pension becomes ~1.92\u00d7 (about 92% higher).<\/p>\n \u2014 If it is 2.15, the basic pension becomes ~2.15\u00d7 (about 115% higher).<\/p>\n \u2014 If it is 2.57 (same as 7th CPC), basic pension becomes ~2.57\u00d7 (about 157% higher).<\/p>\n This multiplication applies to the basic pension. When a new pay commission is implemented, Dearness Relief (DR) is reset and then builds again on the revised base.<\/p>\n \u201cHence, the immediate in-hand change can look different from a simple multiplication headline,\u201d Ghatak noted.<\/p>\n What is likely fitment factor?<\/p>\n The 8th Pay Commission aims to balance inflationary pressures with government finances, a principle unchanged since the 7th Pay Commission in 2015.<\/p>\n Although discussions mention possible fitment factors like 1.92, 2.15, or 2.57, nothing has been finalised yet, said Ghatak.<\/p>\n