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There is a likelihood that the commission may not submit its report before mid-2027. The Cabinet will then examine the recommendations and take a decision on approval. However, the new pay structure is expected to be implemented retrospectively from January 1, 2026.

Central government employees and pensioners are likely to receive revised salaries and benefits only after Cabinet approval, while arrears would be calculated from January 1, 2026.

Government Rules Out Merger of DA, DR With Basic Pay

Union Minister of State for Finance Pankaj Chaudhary on Monday said the government has notified the constitution of the 8th Central Pay Commission, and there is currently no proposal to merge the existing dearness allowance (DA) or dearness relief (DR) with the basic pay.

“No proposal regarding merger of the existing dearness allowance with the basic pay is under consideration with the government at present. In order to adjust the cost of living and to protect basic pay/ pension from erosion in real value on account of inflation, the rates of DA/ DR are revised periodically every six months on the basis of the All India Consumer Price Index for Industrial Workers (AICPI-IW) released by Labour Bureau, Ministry of Labour and Employment," Chaudhary said in response to a query in the Lok Sabha.

Currently, both DA and DR stand at 55% of the basic pay or pension. Last month, the government increased DA and DR by 3% to 55% ahead of Diwali.