New Delhi, January 18: A key question is being widely debated among central government employees and pensioners: will the Dearness Allowance (DA) be merged with Basic Pay before the implementation of the 8th Pay Commission? The discussion has gained momentum as the tenure of the 7th Pay Commission ended on December 31, 2025, making the January–June 2026 DA hike the first revision outside its framework.

Although the 8th Pay Commission has begun preliminary work, its recommendations are unlikely to be implemented before the end of 2027. Typically, a pay commission takes around 18 months to submit its report, followed by another six months for cabinet approval and rollout. In this gap period, employee unions have demanded interim relief by merging the existing 58% DA with Basic Pay. 8th Pay Commission: How Much Salary Hike Can Group A, B, C and D Employees Expect?

However, the government has made its position clear. In a written reply in Parliament in December 2025, it stated that there is no proposal under consideration to merge DA with Basic Pay. The government maintains that the twice-yearly DA revision, linked to the AICPI-IW inflation index, adequately compensates employees and pensioners for rising prices. 8th Pay Commission: Will Central Government Employees Have to Wait Until 2027 for Salary Hike?

Employee organisations argue that merging DA would raise basic salaries, automatically increase allowances like HRA and TA, and improve pension calculations. They also claim that the current DA does not fully reflect actual inflation.

Historically, the issue has been debated before. While the 5th Pay Commission allowed DA merger at the 50% mark, the 6th Pay Commission firmly rejected it, citing the need to reset the inflation base index and warning that future DA rates could decline. It also upheld the system of granting DA only twice a year, ensuring 100% inflation neutralisation.

Given the government’s clear stance and past pay commission reasoning, the chances of DA merger before the 8th Pay Commission appear slim. For now, central employees and pensioners are likely to receive relief only through regular half-yearly DA hikes until the new pay structure comes into force.

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(The above story first appeared on LatestLY on Jan 18, 2026 03:58 PM IST. For more news and updates on politics, world, sports, entertainment and lifestyle, log on to our website latestly.com).