7th Pay Commission – Final Report on Allowances in next few days, Maximum HRA likely to be Rs 60,000
Central government employees have been waiting for higher allowance since July last year when the government notified the implementation of the 7th Pay Commission recommendations. The government is waiting for report of the Committee on Allowances on higher allowances under the 7th Pay Commission.
As per sources, the committee on allowances will submit its final report on Thursday (April 27), when the Finance Minister Arun Jaitley returns to the country after his visit to US and Russia.
The allowances form a sizeable amount of the salary drawn by a government employee.
Finance Minister Arun Jaitley left for US on April 20 to attend the annual Spring meetings of the International Monetary Fund and the World Bank. From US, Arun Jaitley will travel to Moscow for a two-day visit from April 25.
It is believed that the Committee on Allowances then submit its report on higher allowances under the 7th Pay Commission. Earlier, sources in the Finance Ministry informed that the report on higher allowances under the 7th Pay Commision was in the final stage and the Committee on Allowances would submit it to the Finance Ministry anytime soon.
According to sourcess, Finance Secretary Ashok Lavasa led committee is in the process of preparing notes for it to be taken up by the government. The committee had held a meeting on April 6, which was called as ‘conclusive’ by employees’ unions.
A government official had attributed the delay in submission of the report to non-availability of allowance panel members. “I believe that there has been some delay in the finalisation of the report as some allowance panel members were outside the country on an official visit,” he was quoted as saying.
The 7th Pay Commission had earlier proposed the rate of House Rent Allowance (HRA) at 24 percent, 16 percent and 8 percent of the Basic Pay for Class X, Y and Z cities respectively.
The Commission had also recommended that the rate of HRA will be revised to 27 percent, 18 percent and 9 percent when DA crosses 50 percent, and further revised to 30 percent, 20 percent and 10 percent when DA crosses 100 percent.
The existing rates of HRA for Class X, Y and Z cities and towns are 30 percent, 20 percent and 10 percent of Basic pay (pay in the pay band plus grade pay).
Assumingly, if the Committee accepts the bare recommendations of A K Mathur-led 7th Pay Commission then the HRA component of central government employees will increase ranging between 106 percent and 122 percent.
Take, for instance, a central government employee at the very bottom of the pay scale, where the basic pay (pay of pay band + grade pay) is now Rs 7,000, would currently be entitled to an HRA of Rs 2,100 in a Class X city. As per 7th Pay Commission, the new entry level pay at this level is Rs 18,000 per month against which the new HRA for a Class X city would be Rs 4,320 per month, that is 106 percent more than the existing level.
Similarly, at the highest level of the pay scale, the Cabinet Secretary and officers of the same rank have a basic pay of Rs 90,000, which means they are entitled to current HRA of Rs 27,000 in Class X towns. After the revised pay scale, the new basic pay is Rs 2.5 lakh, for which the HRA would be Rs 60,000, meaning a hike of 122 percent.
As far as Transport Allowance (TA) is concerned, Pay Commission had proposed no increase.