7th Pay Commission: Higher Allowances To Be Paid From May 1

Date of posting : 13 April 2017

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New Delhi: The ‘Committee on Allowances’ on 7th Pay Commission will submit its final report on payment of allowances to Finance Minister Arun Jaitley this week,” a top finance ministry official today told The Sen Times on condition of anonymity.

“If the final report is submitted on the stipulated time and the report gets cabinet nod by end of the month, then government employees can expect higher allowances from May 1,” responding to our reporter, the finance ministry official said.

The government on June 29 accepted the recommendations of the 7th Pay Commission headed by AK Mathur in respect of the hike in basic pay and pension. However, The Committee on Allowances headed by the Finance Secretary Ashok Lavasa was formed in July 2016 following protests by government employees over recommendations of the 7th Pay Commission on allowances.

The 7th Pay Commission had recommended of abolishing 51 allowances and subsuming 37 others out of 196 allowances.

The committee was initially given four months’ time to submit the report to Finance Minister Arun Jaitley.

Later, the Finance Minister extended the deadline for report submission to February 22, 2017.

Besides the basic salary, a large portion of a central government employee’s salary is the house rent allowance (HRA); some changes are to be made in this category.

“The committee finalised its views on the pay commission recommendation of reducing the house rent allowance (HRA) to 24%, 16% and 8% of basic pay as against the 30%, 20% and 10% of basic pay employees were drawing under the Sixth Pay Commission,” the official also said.

“The committee has also proposed to abolish 52 allowances, and subsume 36 allowances into existing allowances or proposed as new one. 12 Allowances are to be retained without changes, while the rest of the allowances have been tweaked little,” he added.

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