7th Pay Commission: Government employees will get higher allowances from this month

Key Highlights: 

• More than 48 lakh government employees to see higher allowance
• HRA approved at 24%, 16% and 8% for X,Y, Z employees
• 7th CPC recommendations is estimated at Rs 30748.23 crore per annum

Government employees will start getting higher allowances from this month after the Union Cabinet cleared the recommendations made under the 7th Pay Commission last week.

On June 28, 2017, Union Cabinet chaired by PM Narendra Modi approved recommendations of the 7th CPC on allowances with some modifications.

The revised rates of the allowances came into effect from July 01, 2017. As per the cabinet, these revisions would affect more than 48 lakh central government employees.

Recommendations included arrears like House Rent Allowance, Dearness Allowance, Transport Allowance and many others under the 7th Pay Commission.

Government has decided not to abolish 12 of the 53 allowances which were recommended to be abolished by the 7th CPC. The 7th Pay committee had proposed  subsuming nearly 200 allowances into one except a few.

Here's what government employees will be getting from this month.

HRA:

HRA or House Rent Allowance is a component of salary provided by employer to his employee. Cabinet has approved the following revision under HRA.

As the HRA at the reduced rates may not be sufficient for employees falling in lower pay bracket, the cabinet has decided that HRA shall not be less than Rs 5400, Rs 3600 and Rs 1800 for X, Y and Z category of cities respectively.

However, HRA is subjected to change in two phases – when DA crosses 50%, HRA will be revised to 27%, 18% and 9% and when DA reaches 100%, HRA will be revised back to 30%, 20% and 10% respectively.

This will benefit more than 7.5 lakh employees belonging to Levels 1 to 3.

Also Read: 7th Pay Commission: Full list of all 34 revisions and HRA decision taken by Cabinet

Siachen Allowance:

7th CPC had recommended  Siachen Allowance in the RH-Max cell of the R&H Matrix with two slabs of Rs 21,000 and Rs 31,500.

Government has decided to further enhance the rates of Siachen Allowance which will now go up from the existing rate from Rs 14,000 to Rs 30,000 per month for Jawans & JCOs (Level 8 and below) and from Rs 21,000 to Rs 42,500 per month for Officers (Level 9 and above).

Transport Allowances: 

As per the cabinet, allowances not indexed to DA were raised by a factor of 2.25 and the partially indexed ones by a factor of 1.5. The quantum of allowances paid as a percentage of pay was rationalized by a factor of 0.8. 

Also Read: 7th Pay Commission HRA approved: We help you calculate

Dress Allowance: 

These have been rationalised and subsumed in newly proposed Dress Allowance to be paid annually in four slabs @ Rs 5000, Rs 10,000, Rs 15,000 and Rs 20,000 per annum for various category of employees.

Currently, employees pay various types of allowance for provisioning and maintenance of uniforms/outfits such as Washing Allowance, Uniform Allowance, Kit Maintenance Allowance, Outfit Allowance etc. 

Combined additional financial implication on account of the 7th CPC recommendations along with the modifications approved by the Cabinet is estimated at Rs 30748.23 crore per annum.