8th Pay Commission Update: Major Shift in Dearness Allowance (DA) Calculation—All You Need to Know

The central government approved the formation of the 8th Pay Commission in January. The timeline for the 7th Pay Commission will end on December 31, 2025, and the new pay commission is expected to be implemented starting January 1, 2026. However, after the formation of the panel, it may take around 15-18 months for its final report to be ready. According to sources, the panel may submit its recommendations by April-May 2026. But it will take some more time for the final report to be completed. Therefore, it is expected that the new pay commission will be implemented by 2027.

A major question is whether the Dearness Allowance (DA) will be merged with the basic salary when the new pay commission is implemented, or if the current situation will remain the same. There are also discussions about the possibility of the government changing the calculation of DA under the new pay commission. One option being considered is changing the base year for calculating Dearness Allowance (DA Base Year).

Panel May Be Formed in May

The wait for central employees is almost over. The panel for the 8th Pay Commission is expected to be formed in early May. The government gave its approval back in January.

When Will the New Pay Commission Be Implemented?

The term of the 7th Pay Commission will end on December 31, 2025. The new pay commission is expected to start from January 1, 2026. However, it may take 15-18 months for the final report to be ready, meaning its implementation could be delayed until 2027.

Will the Current DA Be Merged with the Basic Salary?

One of the biggest questions is whether the current Dearness Allowance (DA) will be added to the basic salary when the new pay commission is introduced, or if the existing system will stay the same.

Will the Method of DA Calculation Change?

Another important topic of discussion is whether the government will change the method of calculating Dearness Allowance in the 8th Pay Commission.

The ‘Base Year’ of Dearness Allowance May Change

According to sources, the government may change the base year for calculating DA. This change could affect the entire calculation process.

Current Base Year for DA

Currently, the base year for calculating DA is 2016, which was updated during the implementation of the 7th Pay Commission.