DA DR will not be merged with basic pay:FinMin issues clarification, 8th Pay Commission may be implemented from 1 January 2026

The Finance Ministry has issued a clarification that there is no proposal under consideration to merge DA (Dearness Allowance) and DR (Dearness Relief) with basic pay. The ministry has given this clarification on the long-standing demand of central government employees and pensioners. This statement comes at a time when discussions about the 8th Pay Commission are in full swing and employees are hoping for salary growth. A ministry official said that merging DA and DR with basic pay would bring a major change in the salary structure. However, no decision has been made yet. This clarification was given after rumors going viral on social media, where it was being said that the merger announcement could happen soon. Meanwhile, the timeline for implementation of the eighth pay commission has not been announced yet. It is being speculated that it could be implemented from January 1, 2026. However, its complete implementation might have to wait until 2028. This is why many people have questions about whether the government will continue to revise the Dearness Allowance (DA) until the next Pay Commission is implemented, or if employees will have to wait until the next Pay Commission for a salary increase. When did the demand for DA-DR merger begin? Central employee organizations have been demanding DA-DR merger since the 7th Pay Commission of 2016. Their argument is that as inflation increases, the burden of DA increases, and merging it with basic pay would benefit pension and other allowances. A Staff Side representative said, “This merger would provide relief to employees, but no concrete steps were taken by the government.” Financial experts believe that the merger will put additional burden on the government. An analyst explained, “DA has currently reached 58%. Merging it will increase basic pay and could increase expenditure by more than 0.5% of GDP.” However, the ministry said that DA will continue to be increased periodically to provide relief from inflation. Finance Ministry’s Statement, End to Rumors The statement issued by the ministry clearly states that the government has no proposal to merge DA and DR into basic pay. This statement was issued when fake news was spreading on social media. The official further said that employees should avoid misleading news. We review DA on time. Such rumors also spread last year, but the ministry rejected them every time. A senior officer explained that in the 7th Pay Commission, the fitment factor was kept at 2.57, which was implemented without DA merger. Now the process of forming the 8th Commission committee is underway, but there is no discussion on merger. What to Expect from 8th Pay Commission? When Will it be Implemented? The 8th Pay Commission may be implemented from January 1, 2026, which will benefit more than 50 lakh central employees and 65 lakh pensioners. Employee unions say that the fitment factor could be up to 2.46, which will increase average salary by 30-40%. However, there is disappointment over no DA merger. A union leader said that if the merger had happened, pensioners would have gotten major relief. The government should reconsider this. Experts estimate that the commission’s formation could be announced in the 2025-26 budget. For now, the next DA increase is set until March 2026. Impact on employees: With this clarification, employees will have to rely only on DA. With inflation rate at 5.49%, the next increase could be 3%. Financial planners advise to focus on savings and increase investments in mutual funds. An expert said that salary will remain stable, but create side income sources to deal with inflation. Overall, while this decision is a setback for employees, there is still hope for major relief from the 8th Commission. The government has assured that all benefits will be ensured on time. The First Pay Commission Was Implemented in 1947 Note: The 8th Pay Commission will be implemented from 1 January 2026. However, it may take some time for it to be fully applied. ​