New Delhi9 minutes ago
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The Finance Ministry has issued a clarification that there is no proposal under consideration to merge DA (Dearness Allowance) and DR (Dearness Relief) into the basic pay. The ministry has given this clarification on the long standing demand of central employees and pensioners.
This statement has come at a time when discussions about the 8th Pay Commission are in full swing and employees are expecting salary growth. A ministry official said that merging DA and DR into basic pay will bring a big change in the salary structure. But no decision has been taken yet.
This clarification was given after rumors going viral on social media. Where it was being said that a merger could be announced soon. The timeline for the implementation of the Eighth Pay Commission has not been announced yet. It is being speculated that it may come into effect from January 1, 2026. But it may have to wait till 2028 for it to be fully implemented.
This is why many people have a question in their minds whether the government will keep revising the Dearness Allowance (DA) until the implementation of the next Pay Commission, or whether the employees will have to wait till the next Pay Commission for the salary increase.
When did the demand for DA-DR merger start?
Organizations of central employees have raised the demand for DA-DR merger since the 7th Pay Commission in 2016. Their argument is that due to increase in inflation, the burden of DA increases, which by adding it to the basic pay will provide benefits in pension and other allowances. A representative from the staff side said, ‘This merger will be a relief for the employees, but no concrete steps were taken by the government.’
Financial experts believe that the merger will put additional burden on the government. An analyst said, ‘DA has currently reached 50%. By merging it, the basic pay will increase and expenditure may increase by more than 0.5% of GDP. However, the ministry stressed that DA will continue to be increased from time to time, so that there is relief from inflation.
Finance Ministry’s statement, putting an end to rumors
In the statement issued by the ministry, it is clearly written that the government has no proposal to merge DA and DR into basic pay. This statement was issued when fake news was spreading on social media. The officer further said that employees should avoid misleading news. We do DA review on time.
Last year also such rumors were raised, but every time the ministry rejected them. A senior officer said that in the 7th Pay Commission, the fitment factor was kept at 2.57, which was implemented without the DA merger. Now the process of forming the committee of the 8th Commission is going on, but there is no discussion on merger.
What to expect from the 8th Pay Commission, when will it be implemented?
The 8th Pay Commission may be implemented from January 1, 2026, which will benefit more than 50 lakh central employees and 65 lakh pensioners. Employee unions say the fitment factor could be as high as 3.68, which would increase the average salary by 30-40%. But there is disappointment over DA merger not happening.
A union leader said that if the merger had happened, the pensioners would have got a big relief. The government should think again on this. Experts estimate that the formation of the commission may be announced in Budget 2025-26. At present, the next DA hike is scheduled for March 2026, which could reach 53%.
Impact on employees, what to plan?
With this clarification, employees will have to depend on DA only. With the inflation rate being 5.49%, the next increase could be 3%. Financial planners advise to focus on savings and increase investments in mutual funds. An expert said that the salary will remain stable, but create a side income source to deal with inflation.
Overall, this decision is a shock for the employees, but there is hope of big relief from the 8th Commission. The government has assured that all facilities will be ensured on time.
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