Govt Rules: Big news for central government employees. The government has introduced new regulations regarding pensions, salaries, and various expenditures, including LTC. On June 9, 2026, the Department of Expenditure updated the DFPR rules. This updated list will now be referred to as “Object Heads.” The new regulations will take effect starting from the fiscal year 2027-28. Please be aware that this change will not impact your salary, pension, allowance, or gratuity.
Salary and allowances will receive a new classification
Under the revised framework, employee allowances will now be categorized separately, including salary, allowances, medical treatment, and LTC. This new rule will provide a comprehensive definition of allowances, which will encompass DA, HRA, transport allowance, foreign allowance, child education allowance, and other benefits that government employees receive in addition to their base salary.
Pension will be categorized separately
As per the newly amended regulations, expenses related to pensions will be classified into a distinct category. According to this directive, “Pensionary Charges” will now cover pension payments, gratuity, provident fund contributions, and leave encashment payments. It’s important to mention that NPS and UPS will also be included in this category. This change will facilitate easier tracking of pension-related expenditures for policymakers and analysts.
Travel expenses
Official expenses incurred within India will now be classified as domestic travel expenses. Conversely, travel expenses incurred abroad will be categorized as foreign travel expenses. Expenses related to training will now be classified under the fees category. The revised framework will separate domestic travel, foreign travel, and training expenses into distinct categories. The Finance Ministry indicates that the aim of this order is to establish uniformity in expenditures between the central and state governments.
8th Pay Commission Update
It’s often observed that there’s a significant lag between the implementation and effectiveness of a pay commission. This is due to the preparation of the report and the subsequent government decision. The 8th Pay Commission’s implementation date is January 1, 2026. However, it will take some time for it to become fully effective. The commission is currently preparing its report and other relevant measures. Accordingly, employees will be eligible for arrears, but the final decision on this matter will be made by the government.
If this fitment factor is implemented, the basic pay will increase from Rs 18,000 to Rs 69,000. This means that the basic pay could increase by Rs 51,000 if the fitment factor of 3.83 is implemented. Suppose it takes 24 months for the 8th Finance Commission to become effective. In such a situation, employees will receive arrears of up to Rs 12.24 lakh. However, even if arrears of 18 months are received, the amount will still be Rs 9.18 lakh. The central government has not yet taken any decision on the fitment factor.