Central government employees and pensioners are eagerly awaiting the formation and implementation of the 8th Pay Commission. Although they expected the notification before Navratri and Diwali, the government has not given any green signal yet. Additionally, it has long been a demand of central government employees that their DA be merged with the basic pay once it crosses 50 percent. Will the DA be merged with the basic pay this time?

8th pay Commission

The government has announced that the recommendations of the 8th Pay Commission will come into effect from January 1, 2026, while the 7th Pay Commission will remain in force until December 31, 2025. The practice of automatically merging Dearness Allowance (DA) with basic pay when it reaches 50% is no longer followed for central government employees. However, employees and the unions demand that the old practice be revived under the upcoming 8th Pay Commission. They argue that merging DA with the basic pay will protect their real income from inflation and ensure fair salary revisions.

Will the Government merge DA with the Basic pay?

8th pay commission: As of now, the government has no plans to merge Dearness Allowance (DA) with basic salary. While the demand may be raised during discussions on the upcoming 8th Pay Commission, it is unlikely to be approved by the Central Government.

What is DA (Dearness Allowance)?

• DA is an extra allowance added to the basic salary of central government employees and pensioners
• It’s designed to offset the effects of inflation (rising prices of goods and services)
• The government calculates it twice a year based on the Consumer Price Index (CPI) and announces hikes accordingly
• Example: If your basic salary is ₹50,000 and DA is 50%, you get an additional ₹25,000 as DA, making your total pay ₹75,000 (before other allowances)

What exactly is the Fitment Factor, and what are the hikes?

8th pay commission: A fitment factor is important to decide the Central government employees’ salaries and pensions. Currently, in the 7th Pay Commission, the fitment factor is at 2.57. This will be increased to 2.86, if it is adopted. central government pay scales will rise sharply.

• Level 1: Rs 18,000 → Rs 51,480
• Level 5: Rs 29,200 → Rs 83,512
• Level 10: Rs 56,100 → Rs 1,60,446
• Level 13A: Rs 1,31,100 → Rs 3,74,946
• Level 18: Rs 2,50,000 → Rs 7,15,000

Impact of the 8th pay commission on Government employees

• The minimum pension could increase by about ₹20,500, reaching ₹25,740.
• Around 5 million central government employees and 6.5 million pensioners will benefit from the 8th Pay Commission.
• In total, about 11.5 million people will be directly impacted.
• Salaries and pensions are expected to rise by 30–34%.
• The fitment factor could be revised in the range of 1.83 to 2.86, directly affecting employees’ basic pay.
• The government has approved the 8th Pay Commission, but the formal establishment and notification of its Terms of Reference (ToR) are still pending.
• The minimum basic pay for Level 1 employees may be revised to ₹51,480.