New Delhi: The Union Cabinet on Wednesday approved recommendations of 7th Central Pay Commission with as many as 34 modifications. The recommendations when comes into effect would impose an additional annual burden of Rs 30,748 crore on the exchequer.
"The Union Cabinet chaired by Prime Minister Narendra Modi approved the recommendations of the 7th CPC on allowances with some modifications. The revised rates of the allowances shall come into effect from 1st July, 2017 and shall affect more than 48 lakh central government employees", a statement issued by Cabinet Committee on Economic Affairs (CCEA) said.
While approving the recommendations of the 7th CPC on 29th June, 2016, the Cabinet had decided to set up the Committee on Allowances (CoA) in view of substantial changes in the existing provisions and a number of representations received.
The modifications are based on suggestions made by the CoA in its Report submitted to Finance Minister on 27th April, 2017 and the Empowered Committee of Secretaries set up to screen the recommendations of 7th CPC.
"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", the statement said.
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", the statement said.
"This will benefit more than 7.5 lakh employees belonging to Levels 1 to 3", the statement added.
As for 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. The rates for specific clothing for different categories of employees will be governed separately", the statement said.
Besides this, the cabinet has also given its nod for increase in Rate of Children Education Allowance (CEA), Special Allowance for Child Care for Women with Disabilities and Higher Qualification Incentive for Civilians.
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