7th Pay Commission: Confusion over HRA may end; Cabinet to meet Tomorrow

7th Pay Commission: Confusion over HRA may end; Cabinet to meet on June 28

In what may come as a relief to central government employees, awaiting clarity on their allowances for a long time, the Union Cabinet in its meet on June 28, is most likely to discuss allowances proposed in the Seventh Pay Commission.

The topic had been a matter of both suspense and annoyance for nearly 47 lakh central government employees, who have been on tenterhooks. The reforms have been awaiting Cabinet approval since they were handed over to Finance Minister Arun Jaitley by Empowered Committee of Secretaries on June 1.

The Pay Commission had recommended that out of a total 196 allowances, 52 be discontinued entirely, whereas 36 other allowances should be subsumed under other (allowances).

According to media reports, the House Rent Allowance (HRA), which forms a major chunk of the employees' salaries, could be approved at 27% of the basic pay. This may bring cheer for the employees, who had been opposing the slashing of rates, proposed initially.

The pay panel had proposed bringing down HRA to 24%, 16% and 8% of the basic pay, to be paid according to the city the employee is positioned in.

The preceding Pay Commission had pegged the same at 30%, 20% and 10%, respectively. The Cabinet formed the Committee on Allowances under Finance Secretary Ashok Lavasa in June 2016 after the central government employees expressed their dissatisfaction.

The Lavasa Committee handed over its review report to the Finance Minister in April after consulting representations from various government departments. The report, post approval, was forwarded to E-CoS for their consideration and consolidation.

The Empowered Committee submitted the report again to the Finance Minister on June 1. Media reports suggest that the E-CoS has capped HRA rates between 25% and 27%. The Cabinet may, however, approve rates higher than that to compensate for the delay in paying allowances as per new rates according to the 7th Pay Commission.

Source:- Times Now

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