7th Pay Commission allowances news today: The Union Cabinet, chaired by Prime Minister Narendra Modi, on Wednesday approved the recommendations of the 7th Pay Commission on allowances with some modifications. The revised rates of the allowances will come into effect from 1st July, 2017 and affect more than 48 lakh Central government employees. The modifications approved by the government in the recommendations of the 7th Pay Commission on allowances will lead to a modest increase of Rs 448.23 crore per annum over the projections made by the 7th CPC. The 7th CPC, in its report, had projected the additional financial implication on allowances at Rs 29,300 crore per annum. The 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.
7 things you need to know to fully understand intricacies of 7th Pay Commission allowances approval:
1. Number of allowances recommended to be abolished and subsumed:
The government has decided not to abolish 12 of the 53 allowances which were recommended to be abolished by the 7th CPC. The decision to retain these allowances has been taken keeping in view the specific functional requirements of Railways, Posts and Scientific Departments such as Space and Atomic Energy. It has also been decided that 3 of the 37 allowances recommended to be subsumed by the 7th CPC will continue as separate identities. This has been done on account of the unique nature of these allowances. The rates of these allowances have also been enhanced as per the formula adopted by the 7th CPC. This will benefit over one lakh employees belonging to specific categories in Railways, Posts, Defence and Scientific Departments.
2. House Rent Allowance
HRA is currently paid @ 30% for X (population of 50 lakh & above), 20% for Y (5 to 50 lakh) and 10% for Z (below 5 lakh) category of cities. 7th CPC has recommended reduction in the existing rates to 24% for X, 16% for Y and 8% for Z category of cities. As the HRA at the reduced rates may not be sufficient for employees falling in lower pay bracket, it has been decided that HRA shall not be less than Rs 5400, Rs 3600 and Rs 1800 for X, Y and Z category of cities, respectively. This floor rate has been calculated @ 30%, 20% and 10% of the minimum pay of Rs 18000. This will benefit more than 7.5 lakh employees belonging to Levels 1 to 3.
7th CPC had also recommended that HRA rates will be revised upwards in two phases to 27%, 18% and 9% when DA crosses 50% and to 30%, 20% and 10% when DA crosses 100%. Keeping in view the current inflation trends, the government has decided that these rates will be revised upwards when DA crosses 25% and 50% respectively. This will benefit all employees who do not reside in government accommodation and get HRA.
3. Siachen Allowance
7th CPC had placed Siachen Allowance in the RH-Max cell of the R&H Matrix with two slabs of Rs 21,000 and Rs 31,500. Recognizing the extreme nature of risk and hardship faced by officers / PBORs on continuous basis in Siachen, the government has decided to further enhance the rates of Siachen Allowance which will now go up from the existing rate of 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). With this enhancement, Siachen Allowance will become more than twice the existing rates. It will benefit all the soldiers and officers of Indian Army who are posted in Siachen.
4. Dress Allowance
At present, various types of allowances are paid for provisioning and maintenance of uniforms/outfits such as Washing Allowance, Uniform Allowance, Kit Maintenance Allowance, Outfit Allowance etc. 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. This allowance will continue to be paid to Nurses on a monthly basis in view of high maintenance and hygiene requirements. Government has decided to pay higher rate of Dress Allowance to SPG personnel keeping in view the existing rates of Uniform Allowance paid to them (which is higher than the rates recommended by the 7th CPC) as also their specific requirements.
5. Tough Location Allowance
Some allowances based on geographical location such as Special Compensatory (Remote Locality) Allowance (SCRLA), Sunderban Allowance & Tribal Area Allowance have been subsumed in Tough Location Allowance. The areas under TLA have been classified into three categories and the rates will be governed as per different cells of R&H Matrix and be in the range of Rs 1000 – Rs 5300 per month.
6. Recommendations in respect of some important allowances paid to all employees:
(I) Rate of Children Education Allowance (CEA) has been increased from Rs 1500 per month / child (max. 2) to Rs 2250 per month / child (max.2). Hostel Subsidy will also go up from Rs 4500 per month to Rs 6750 per month.
(ii) Existing rates of Special Allowance for Child Care for Women with Disabilities has been doubled from Rs 1500 per month to Rs 3000 per month.
(iii) Higher Qualification Incentive for Civilians has been increased from Rs 2000 – Rs 10000 (Grant) to Rs10000 – Rs 30000 (Grant).
7. Apart from the above-mentioned recommendations, many other recommendations have also been approved
Recommendations in respect of some important allowances paid to Uniformed Services like Defence, CAPFs, Police, Indian Coast Guard and Security Agencies; recommendations in respect of some important allowances paid to Indian Railways; recommendations in respect of some important allowances paid to Nurses & Ministerial Staffs of Hospital; recommendations in respect of some important allowances paid to Pensioners; allowances to Scientific Departments; and allowances paid to D/o Posts.
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While increasing the rate of allowances affecting the Central government employees, especially the Defence, CAPF and Coast Guard personnel, the staff of Railways, Postal department and nursing staff, the total number of allowances have been rationalized from 197 to 128.