7th Pay Commission: Gratuity ceiling doubled to Rs 20 lakh, housing loan allowance hiked to Rs 25 lakh

By: | Published: June 29, 2016 6:39 PM

As part of the 7th Pay Commission rollout, gratuity ceiling has been doubled to Rs 20 lakh and housing loan allowance has been hiked from Rs 7.5 lakh to Rs 25 lakh.

The 7th Pay Commission had recommended 23.55 per cent overall hike in salaries, allowances and pension involving an additional burden of Rs 1.02 lakh crore or nearly 0.7 per cent of the GDP. (PTI PHOTO) The 7th Pay Commission had recommended 23.55 per cent overall hike in salaries, allowances and pension involving an additional burden of Rs 1.02 lakh crore or nearly 0.7 per cent of the GDP. (PTI PHOTO)

As part of the 7th Pay Commission rollout, gratuity ceiling has been doubled to Rs 20 lakh and housing loan allowance has been hiked from Rs 7.5 lakh to Rs 25 lakh. This was announced by Finance Secretary Ashok Lavasa at a press conference in New Delhi.

The 7th Pay Commission had recommended 23.55 per cent overall hike in salaries, allowances and pension involving an additional burden of Rs 1.02 lakh crore or nearly 0.7 per cent of the GDP. The recommendation would be effective from January 1, 2016.

However, the hike is the lowest in last seven decades as it is built around the recommendation for a 14.27 per cent hike in basic pay.

The 23.55 per cent overall hike in salaries, allowances and pension would entail an additional burden of Rs 1.02 lakh crore or nearly 0.7 per cent of the GDP, to the exchequer.

The entry level pay has been recommended to be raised to Rs 18,000 per month from current Rs 7,000 while the maximum pay, drawn by the Cabinet Secretary, has been fixed at Rs 2.5 lakh per month from current Rs 90,000.

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