7th Pay Commission: Cabinet may take final call on HRA, pending allowances today
- Cabinet may announce final verdict on House Rent Allowance and other pending allowances
- The 7th Pay Commission recommendations were cleared by the government in June last year
- With just a 14.27 per cent hike in basic pay, the 7th Pay Panel’s recommendation was the lowest in the past 70 years
- Out of the 196 existing allowances, the Pay Commission advised the ouster of 52 allowances while clubbing 36 other under other grants.
- Approximately 47 lakh Central government employees, who have been expecting a hike in salary after the 7th Pay Commission report, will be keenly following today’s developments
Mumbai: The wait for approximately 47 lakh Central government employees, who have been expecting a hike in salary after the 7th Pay Commission report, could be over as the Cabinet, may take a call on pending dues and approve House Rent Allowance (HRA) rates on Wednesday.
It has been one year since the commission’s 2015 report was approved by the Central Government on June 29, 2016. While the approval came a long time ago, several snags in software led to delays, despite the Empowered Committee of Secretaries’ (E-CoS) report submission to Finance Minister Arun Jaitley on June 1.
There have been several delays despite Finance Secretary Ashok Lavasa, Jaitley and Prime Minister Narendra Modi holding discussions on the Pay Commission report. The delay in approval of pending allowances including HRA has been a matter of pain for central government employees, some of whom have expressed dissatisfaction over the delay.
The prescribed changes
Out of the 196 existing allowances, the Pay Commission advised the ouster of 52 allowances while clubbing 36 other under other grants. While the 7th Pay Panel headed by AK Mathur had suggested cutting down the HRA to 24 per cent, 16 per cent and 8 per cent, on the basis of the city an employee is posted. In contrast, the 6th Pay Commission had set this rate at 30 per cent, 20 per cent and 10 per cent accordingly.
However, the drastic reduction did not go down well with the lakhs of central government employees, and this is why the government was forced to re-examine the HRA rates. It has been reported that the Ashok Lavasa-headed Committee on Allowances, which was formed for inspecting the allowance rates, has pegged the HRA rate between 25 to 27 per cent for Tier 1 cities, 18 per cent for Tier 2 cities and 9 per cent for Tier 3 cities.
Apart from HRA, the Dearness Allowance – given to central government employees to combat inflation – is also in the ambit. However, in view of rising costs of products and services, employees are not happy with the meagre 2 per cent rise in DA that was suggested by the pay panel.
The mere 2 per cent rise in DA is a result of the pattern in which this allowance in calculated – the allowance is planned taking a 12-month average of retail inflation. Central Government Employees President K K N Kutty and experts alike have earlier expressed dissatisfaction of the new rates, terming it as “meagre”.
Cloud of concerns
A central government employee working for Indian Railways, who spoke on condition of anonymity, rubbished the hype surrounding the 7th Pay Commission, as it was only being glorified while benefits were struck off conveniently. The benefit of the 2 per cent DA increase does not even add up to Rs 2,500 in the case of a particular pay grade, under which this individual is employed.
“We have been waiting for the decision for months now and have no clue yet on what the verdict on HRA and DA will be. We (Railway employees) have heard that the cabinet will take up the issue and we are hoping for a positive verdict,” the individual said.
With several allowances pending, today will be important for central government employees, who will have their eyes and ears on the likely Cabinet meet that will decide their fate. This will possibly be the last Cabinet meet of the month of June.
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