Budget session starts tomorrow (March 9th), FM likely to announce allowances hike

With the second part of the Budget session in Parliament starting on Thursday, all eyes are on Finance Minister Arun Jaitley who may just announce a hike in allowances for Central government employees.

The Committee on Allowances has already submitted its report to the Finance Ministry in which it has reviewed the recommendations of the Seventh Pay Commission on allowances.

The Committee under Finance Secretary Ashok Lavasa is believed to have suggested that the house rent allowance be kept as it is and not brought down as recommended by the Seventh Pay Commission. While the Committee on Allowances decided against a slash in HRA, reports suggest that it has agreed with Seventh Pay Commission's recommendation on no hike in transport allowance.

To add to the growing resentment among employees, the dearness allowance (DA) is likely to be hiked by just 2 per cent this year. "The dearness allowance as per the agreed formula by the Centre works out to be 2 per cent which would be effective from January 1, 2017," Confederation of Central Government Employees President K K N Kutty said. Representatives of employees unions are not happy with the hike and said it is not in sync with price rise and inflation. According to some reports, employees' union are planning to protest against the "meagre" hike in DA.


The pay hike under the Seventh Pay Commission has been the lowest in the last 70 years and a decrease in allowances is unlikely to go down well with nearly 50 lakh government employees.