“Unfunded Pension” Term in 8th CPC TOR an Insult to Pensioners: C. Srikumar

OPINION PIECE

C. Srikumar, senior leader and veteran trade union representative of Central Government Employees, has strongly criticized the use of the term “Unfunded cost of non-contributory Pension Scheme” in the Terms of Reference (ToR) of the 8th Central Pay Commission (CPC). He termed it as “an insult” to millions of pensioners, including Armed Forces veterans, who dedicated most of their lives to serving the nation.

He argued that such terminology wrongly projects pensioners as a burden on the government’s finances and misleads the public into believing that pensions are paid at the expense of taxpayers. “The dignity and respect of senior citizens who built this country cannot be degraded in this way,” Srikumar asserted.

Comparison with Previous Pay Commissions

Srikumar noted that the 6th and 7th Central Pay Commissions had clear mandates to examine the structure and revision of pensions.

• The 6th CPC focused on principles governing pension, gratuity, and family pension for employees appointed before January 1, 2004.

• The 7th CPC explicitly included pension revision for retirees prior to the new pension scheme (NPS) implementation date.

In contrast, the 8th CPC’s phrasing around “unfunded non-contributory pension” has caused deep anxiety among pensioners, leading organizations like the Bharat Pensioners Samaj (BPS) to express anguish over the omission of any explicit reference to pension revision. BPS has written to the Prime Minister and Finance Minister, urging the inclusion of provisions for pension and Dearness Relief revision for both pre-2004 and post-2004 retirees.

Trade unions including AITUC and CITU have also issued statements expressing similar concerns.

Historical and Legal Context

Srikumar reminded that when the Contributory Provident Fund (CPF) scheme was replaced by the statutory pension system under CCS (Pension) Rules, 1972, the government was expected to create a pension fund by contributing on behalf of employees. However, no such fund was ever established, leading pensions to be paid from the Consolidated Fund of India.

He cited the landmark D.S. Nakara case, where the Supreme Court held that:

• Pension is a right earned through past service, not a charity.

• All pensioners constitute a single class; date of retirement cannot create arbitrary distinctions.

• Pension cannot be withheld at the employer’s discretion.

• Financial constraints cannot justify discrimination among pensioners.

• Discrimination violates Article 14 of the Constitution.

Call for Government Action

Srikumar urged the Government to direct the 8th CPC to clearly recommend pension revision and related benefits effective January 1, 2026, for all retirees, irrespective of their retirement date.

He also reiterated the demand to scrap the New Pension Scheme (NPS) and bring nearly 25 lakh Central Government Employees under the Old Pension Scheme (OPS).

“The government must not shirk its responsibility towards 69 lakh pensioners who have dedicated their lives to public service. Relief for employees and pensioners should not be treated as a liability while concessions to corporates continue unchecked,” Srikumar concluded.

Views expressed here are those of C. Srikumar, veteran trade union leader and General Secretary of AIDEF