If you are a government employee, then there is some great news for you. The wait for the 8th Pay Commission may end soon. It is believed that it can be implemented from January 2026. This news is also special because the recent inflation figures have indicated a tremendous jump in your salary. Let us talk in detail about how Dearness Allowance (DA) and the new Pay Commission are related to each other, and how both of them together will increase your salary.
DA and Fitment Factor
The recently released All India Consumer Price Index (AICPI-IW) data for July 2025 has boosted the morale of central employees. This index has increased by 1.5 points to 146.5. Experts believe that this figure will not only determine the next DA rate, but will also form the basis of minimum wage and fitment factor under the 8th Pay Commission. Just like the 7th Pay Commission had fixed a fitment factor of 2.57 based on 125% DA, similarly, these new figures will also become a part of your 2026 salary.
AICPI-IW data is currently used to determine dearness allowance and dearness relief (for pensioners). Dearness allowance is an important part of the salary, which reduces the impact of inflation. Whenever a new pay commission is implemented, the DA rates applicable at that time play an important role in determining the basic salary and fitment factor. The higher the AICPI-IW index, the higher the DA, and the basic pay is also likely to increase in the same proportion.
How was the fitment factor of 2.57 decided in the 7th Pay Commission
If we look at the recommendations of the 7th Pay Commission, the commission had clearly said that on January 1, 2016, a fitment factor of 2.57 was fixed by combining the existing basic salary and DA of the employees. Out of this, 2.25 was made up of basic pay and 125 percent from DA, while the remaining 0.32 was the increase in the actual salary. Thus, the total increase was about 14.2 percent. The same math will now apply to the 8th Pay Commission as well.
What will happen to DA when the new Pay Commission comes
It is important to note that as soon as the 8th Pay Commission comes into force, the DA rates will be reset to zero. But, when the commission decides the new minimum wage and fitment factor, the existing DA figures will be made the basis.
At present, the government has not announced the terms and conditions for the 8th Pay Commission and the appointment of the chairman. Because of this, the final report and recommendations of the commission may take some time. But it is certain that the coming time will be very beneficial financially for the central employees.