Major Salary Changes Expected with the 8th Pay Commission
The 8th Pay Commission is set to bring significant changes to the salaries and allowances of central government employees and pensioners. One of the most notable changes will be in the Dearness Allowance (DA), which is expected to reach 61% by January 2026 before being reset to zero when the new pay commission is implemented.
Let’s explore how this change will impact central employees, how the salary structure will be revised, and why DA will be merged with the basic salary.
The 8th Pay Commission is expected to start its work in April 2025, and its recommendations will be implemented in January 2026. As per existing rules, when a new Pay Commission is implemented, the Dearness Allowance (DA) is merged into the basic salary and starts again from 0%.
✅ Key Highlights:
👉 Scenario Before the 8th Pay Commission:
By January 2026, the Dearness Allowance is expected to be 61%. This means an employee with a basic salary of ₹34,200 will receive ₹20,862 as DA.
👉 Scenario After the Implementation:
📌 Example:
If an employee’s basic salary is ₹18,000 and DA is 50% (₹9,000) before the 8th Pay Commission, then:
✅ After the merger, the new basic salary will be ₹27,000 (₹18,000 + ₹9,000).
✅ DA will restart at 0% and gradually increase over time.
Dearness Allowance (DA) is linked to the Consumer Price Index (CPI) and is revised twice a year (January & July). It is calculated based on:
✔ The All India Consumer Price Index (AICPI)
✔ The base year’s inflation rate
Formula for DA Calculation:
DA(%)=(AICPI−115.76115.76)×100DA (\%) = \left(\frac{\text{AICPI} - 115.76}{115.76} \right) \times 100DA(%)=(115.76AICPI−115.76)×100🔹 Historical DA Mergers in Previous Pay Commissions:
While 100% of DA is ideally merged, experts believe the government may merge only 50% of DA into the basic salary, while keeping the remaining 11% separate. This will reduce the burden on the government while ensuring salary increments for employees.
📌 Example:
If an employee’s current basic pay is ₹20,000 and DA is 60% (₹12,000), after the 8th Pay Commission:
✅ Full merger: New basic salary will be ₹32,000.
✅ Partial merger (50% DA added): New basic salary will be ₹26,000, and remaining DA will be considered separately.
If we follow the trends from previous Pay Commissions, employees can expect:
✅ A salary hike of 20-25% after merging DA.
✅ Increase in pension for retired employees.
✅ Revision in HRA, TA, and other allowances.
📌 Example Salary Growth Projection
| Current Basic Salary (₹) | DA Before Merger (61%) (₹) | New Basic Salary After DA Merger (₹) | Expected Total Salary After 8th Pay Commission (₹) |
|---|---|---|---|
| 18,000 | 10,980 | 28,980 | 32,000 – 35,000 |
| 34,200 | 20,862 | 55,062 | 60,000 – 65,000 |
| 56,000 | 34,160 | 90,160 | 1,00,000 – 1,10,000 |
✅ April 2025 – 8th Pay Commission will start its work.
✅ January 2026 – DA will be merged and reset to 0%.
✅ July 2026 – Fresh DA increments will begin.
The 8th Pay Commission will bring significant changes to salary structures. The merging of DA will result in higher basic salaries, but allowances like HRA and TA may see some changes. Employees should prepare for the transition, as this will impact take-home salaries, pensions, and overall earnings.
💡 What’s Next?
📢 Stay tuned for further updates when the government officially announces the 8th Pay Commission’s recommendations!
