8th Pay Commission approved: Central government employees may see 186% rise in pension

8th Pay Commission: The 8th Central Pay Commission (CPC) will come into effect from January 1, 2026

8th Pay Commission: The 8th Central Pay Commission (CPC), which will come into effect from January 1, 2026, will revise salaries, pensions, and allowances, benefiting more than one crore central government employees and pensioners.

8th Pay Commission: Over one crore Central employees and pensioners are set to benefit from the setting of the 8th Pay Commission. (REUTERS)

It may come with a fitment factor of 2.86, resulting in a significant increase in monthly pensions.

The prevailing 7th CPC, implemented in 2016, had a 2.57 fitment factor, which significantly hiked the basic pay.

It also has the minimum basic pension for central government retirees at ₹9,000 per month, while the maximum pension is capped at ₹1,25,000 per month, which is 50% of the highest salary in government service.

Additional benefits like Dearness Relief (DR), which is currently set at 53% of the basic pension, have been shielding pensioners from inflationary pressures.

The DR is generally revised biannually to align itself with inflation, measured by the Consumer Price Index (CPI), ensuring pensioners can maintain their purchasing power despite rising costs.

If the 8th CPC does have a 2.86 fitment factor, the minimum pension which is currently ₹9,000 will rise to nearly ₹25,740 per month, a jump of 186%.

Meanwhile, the maximum pension could jump from the current ₹1,25,000 to potentially exceed ₹3,57,500 monthly.

In addition, the DR may further enhance the revised pensions, along with increasing gratuity ceilings and family pensions.