HomeNotificationFinance Bill, 2025 Doesn’t Alter Pension Structure Under 8th Pay Commission

Finance Bill, 2025 Doesn’t Alter Pension Structure Under 8th Pay Commission

The Central Government has clarified that there is no automatic revision of pension under the 8th Central Pay Commission (CPC) at this stage and that pension revisions will take place only after the Government considers and accepts the recommendations of the Commission.

The clarification came in a written reply to an Unstarred Question (No. 1605) in the Lok Sabha on February 9, 2026, raised by Shri Anand Bhadauria, regarding revision of pension and differentiation among pensioners under the proposed 8th CPC.

Finance Bill, 2025 Does Not Alter Pension Structure

Responding on behalf of the Ministry of Finance, Minister of State for Finance Shri Pankaj Choudhary stated that the Finance Act, 2025 does not authorise any change or differentiation in pension solely on the basis of date of retirement.

The Minister clarified that pensions of Central Government employees are governed by:

  • Central Civil Services (Pension) Rules, 2021
  • Central Civil Services (Extraordinary Pension) Rules, 2023
  • Instructions issued by the Government from time to time.

Revision of pension, the reply noted, is carried out only through general orders issued after acceptance of Central Pay Commission recommendations.

Differentiation Among Pensioners Only Through CPC Recommendations

The Government explained that Central Pay Commissions, being expert bodies, may recommend different pay scales, allowances, and pension structures for different categories of employees. However, any such differentiation can be implemented only after formal acceptance by the Central Government.

Importantly, the reply clarified that Part IV of the Finance Act, 2025 merely validates existing pension rules and governs pension liabilities from the Consolidated Fund of India, without altering existing civil or defence pension entitlements.

No Assurance Yet for Pre-2026 Retirees

On whether Central Government pensioners who retired on or before December 31, 2025 would be covered under pension revision by the 8th CPC, the Government gave no specific assurance. The reply indicated that coverage will depend on the recommendations of the 8th CPC and their subsequent acceptance by the Government.

8th Pay Commission Constituted, Work Underway

The Government confirmed that the 8th Central Pay Commission has already been constituted, along with its Terms of Reference, through a resolution dated November 3, 2025.

As per the resolution:

  • The 8th CPC has 18 months from the date of its constitution to submit its recommendations.
  • The Commission has been mandated to make recommendations on pay, allowances, and pension of Central Government employees.

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Mariya Paliwala
Mariya Paliwalahttps://www.jurishour.in/
Mariya is the Senior Editor at Juris Hour. She has 5+ years of experience on covering tax litigation stories from the Supreme Court, High Courts and various tribunals including CESTAT, ITAT, NCLAT, NCLT, etc. Mariya graduated from MLSU Law College, Udaipur (Raj.) with B.A.LL.B. and also holds an LL.M. She started as a freelance tax reporter in the leading online legal news companies like LiveLaw & Taxscan.

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