8th Pay Commission pension demands: ₹69,000 minimum pay, 67% pension? Check 9 big demands from pensioners

The All India Federation of Pensioners’ Association (AIFPA) has placed several demands before the 8th Pay Commission. These include a higher pension linked to the last-drawn pay, a ₹69,000 minimum basic pay, a 3.83 fitment factor, tax exemption on pension and One Rank One Pension. Here are the 10 key recommendations made by the pensioner body.

AIFPA has proposed that full pension should be fixed at 67% of the last pay drawn, instead of the existing framework. It has also recommended increasing family pension to 50% of last pay drawn, compared with the current 30% mentioned in its submission. The pensioner body says the higher pension would help support a decent and dignified retirement for pensioners and their families.

AIFPA has proposed an earlier and higher increase in additional pension. Its recommendation is for a 5% increase at age 65, followed by another 5% every five years. Under the proposal, pensions would rise to 70% at 65, 75% at 70 and continue increasing, reaching 100% at age 90. This would bring the full additional pension benefit earlier than under the existing system.

AIFPA has recommended a minimum basic pay of ₹69,000 for central government employees, along with a 3.83 fitment factor. Its proposal also includes using five family units for pay calculation and providing a 6% annual increment. The pensioner body has linked its demand to rising household expenses, medical costs, education, family functions and other spending needs.

AIFPA wants the period for restoring commuted pension to be cut from 15 years to 11 years. Central government pensioners can currently commute up to 40% of their basic pension and receive a lump sum at retirement. The commuted portion is then deducted from their monthly pension until restoration. AIFPA argues that, based on its calculation, the commuted value is recovered within about 10 years.

AIFPA has recommended extending One Rank One Pension (OROP) under the 8th Pay Commission. The organisation argues that pension differences between senior and junior pensioners of the same grade and service should be removed. Its submission points to OROP already being available to ex-servicemen since 2017 and to judicial pensioners following a Supreme Court decision.

AIFPA has also sought a reduction in the minimum qualifying service needed for defence personnel to receive a pension. Its submission points out that central civil pensioners can receive a pension after 10 years of service, while the requirement for defence pensioners is 15 years. The organisation wants the defence pension requirement brought in line with that applicable to central civil pensioners.

The pensioner body has demanded income-tax exemption on pension and family pension. It argues that pensions are the main source of income for many senior citizens after they stop working, while medical and care-related expenses can rise with age. AIFPA has also sought tax exemption for disability pension and compassionate allowance received by ex-servicemen.

AIFPA has proposed increasing the Fixed Medical Allowance (FMA) to ₹5,000 per month for those residing in areas not covered by the Central Government Health Scheme (CGHS). It is currently Rs 1,000 per month. It was noted that a Parliamentary Panel had recommended a FMA of ₹3,000 a month in 2022, but that increase has not been implemented. The organisation has also suggested linking FMA to the Consumer Price Index so that the allowance rises automatically when dearness relief increases.

AIFPA said that pensions for BSNL personnel have not been revised since 2017 and has urged the 8th Pay Commission to address the issue. It wants BSNL pension to be revised retrospectively from 2017 based on the 7th Pay Commission recommendations. The pensioner body has also sought action on delayed implementation of arbitration awards, causing financial losses to employees.