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18 Feb, 2017 01:45 PM

HRA can be higher than that proposed 7th pay commission

HRA can be higher than that proposed 7th pay commission A year after implementation of the new pay- and pension-related recommendations of the Seventh Central Pay Commission (CPC), the government is likely to approve the revised allowances proposed by it for central government staff after the ongoing state elections are over, by March 15. The reworked allowances are likely to be effective from April 1 and at least in the case of the employees in metro cities, the house rent allowances (HRA) could be a little more generous than the CPC’s award, sources told FE.

Taking note of employees’ representations, a finance secretary-led panel is looking at HRA of 30% of basic pay for those in cities with a population of over 5 million, against 24% recommended by CPC, the sources said. In the Sixth CPC award period (2006-2015), HRA was 30% for these cities. A draft Cabinet note for implementation of the revised allowances would be circulated soon, the sources said. HRA accounts for about 60% of the total allowances bill.

The financial implication of revised allowances would be broadly in line with the CPC’s estimate of around R29,300 crore (including for the railways) in the first year. The secretaries’ panel is reviewing the commission’s recommendations pertaining to allowances including rationalisation of some 196 existing benefits. The pay panel has suggested the abolition of 52 benefits and merger of 36 with existing ones to end their separate identities.




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