The 8th Pay Commission is set to bring major changes to the salary structure of central government employees and pensioners. One of the biggest impacts will be on the Dearness Allowance (DA), which is expected to reset to zero (0%) once the new pay structure is implemented in January 2026. Let’s understand how this will affect government employees and why it happens with every pay commission.

📌 DA Expected to Reach 61% by 2026

• Current estimates suggest that Dearness Allowance (DA) may reach 61% by January 2026.
• As per standard pay commission rules, when a new pay structure is implemented, existing DA is merged into the basic salary.
• This means that employees will see an increase in their basic pay, but DA will be reset to 0%, and its calculation will start fresh.

🏦 What Happens to DA in the 8th Pay Commission?

1️⃣ DA Will Be Merged with Basic Pay

• If DA reaches 50% or more, the government merges it with the basic salary under the new pay structure.
• This increases basic pay, which boosts other allowances (HRA, TA, etc.).

2️⃣ DA Will Reset to Zero (0%)

• After the merger, the calculation of DA starts again from 0%.
• From July 2026, new DA increments (3%-4%) will be added based on inflation.

3️⃣ Two Scenarios for DA Merger

• Some reports suggest only 50% of DA will be merged into basic pay, and remaining DA will not be merged.
• However, the final decision will depend on the government’s approval of the Pay Commission’s recommendations.

📊 How Will the Salary Change After DA Merger?

Let’s take an example to understand the impact on salary calculations:

Scenario Before 8th Pay Commission

• Basic Salary: ₹18,000
• Current DA (50%): ₹9,000
• Total Salary = ₹18,000 + ₹9,000 = ₹27,000

Scenario After DA Merger in 2026

• New Basic Salary: ₹27,000 (after DA is merged)
• New DA (Initially 0%): ₹0
• Total Salary in January 2026: ₹27,000
• New DA starts accumulating from July 2026

🔹 The biggest advantage is that basic salary increases, which improves retirement benefits, HRA, and pension calculations.

❓ Why is DA Reset to Zero?

This is a standard practice every time a new pay commission is implemented:

✔️ Pay Commission ensures salaries keep pace with inflation.
✔️ DA is merged into basic salary to create a new pay structure.
✔️ This improves long-term benefits like PF, gratuity, and pension.

For example:

• In 2006, during the 6th Pay Commission, DA was merged at 187%.
• In 2016, during the 7th Pay Commission, DA was merged again at 125%.

The same process is expected to happen in 2026 under the 8th Pay Commission.

🔎 When Will DA Be Merged and Reset?

📅 January 2026 – The 8th Pay Commission recommendations will be implemented, and DA will be merged into basic pay.

📅 July 2026 – New DA will start accumulating based on inflation (expected to start at 3%-4%).

Final Thoughts

🔹 Central government employees will see an increase in their basic salary once the 8th Pay Commission is implemented in 2026.
🔹 DA will be merged into basic pay, and a fresh calculation will begin from 0%.
🔹 This will benefit employees in the long term by increasing pension, provident fund, and allowances.
🔹 Final details will depend on the government’s decision and the Pay Commission’s recommendations.

If you are a government employee, keep an eye on official announcements to understand how your salary and benefits will change in 2026! 🚀