7th Pay Commission on House Rent Allowance (HRA)

For Central Government employees, HRA or House Rent Allowance is an essential component of the salary. The Central Government provides its employees with a specific portion of wages to cover rental housing expenses.

Previously, the Central Government provided 10% of basic salary to employees working in other cities as per the recommendation of the 6th Pay Commission. However, the latest Pay Commission, i.e., 7th Pay Commission, recommended a different percentage.

Curious to know about the recommended 7th Pay Commission percentage on HRA? Stay tuned, and you will get an overview of the 7th Pay Commission HRA table as well.

The 7th Pay Commission recommended 8% of matrix pay for employees working in other cities. However, as the lowest basic pay is ₹18000, and HRA is ₹1800, the minimum House Rent Allowance is equivalent to 10%.

As stated in the introductory paragraph, HRA holds a significant position in Central Government employees’ salaries. Therefore, they must know about the new changes and their impacts on their net salary. Currently, all Central Government employees receive a salary as per the 7th Pay Commission recommendations.

Hence, they must know about the particular existing HRA allowance attached to their salary.

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Allotment of House Rent Allowance entirely depends on the cities employees of Central Government reside in. Here, the Central Government has segmented cities or towns into three parts - X, Y, and Z.

Wondering how the Government decides this classification of cities?

Read along!

• If a city has 50 lakh populations or more, it falls under the category of X cities.
• If a city has a population ranging from 5 lakh to 50 lakh, it falls under the category of Y cities.
• If a city has a population of less than 5 lakh, it falls under the category of Z cities.

Further, on 7th July 2017, the Government brought changes in rates and entitlements (as per the recommendation of the 7th Pay Commission) of HRA for Central Government employees. Along with this came a notice stating that House Rent Allowance will increase when DA (Dearness Allowance) reaches beyond 25%.

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Follow the list of HRA rates in the 7th Pay Commission to get a comprehensive idea -

• X Class Cities: 24% of Basic salary
• Y Class Cities: 16% of Basic salary
• Z Class Cities: 8% of Basic salary

As per these specifications, the new 7th Pay Commission HRA table works like this -

Siachen Glacier is the highest front where the Indian troops serve throughout the year despite all climatic challenges. The Central Government provides Siachen Allowance to compensate for the hardships and high risk to protect India from external attacks.

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Previously, Indian soldiers deployed at Siachen Glacier used to get ₹30000 (for Junior Commissioned Officers -up to Level 8) and ₹14000 (for Jawans) per month. This amount was quite low compared to the hardships they faced in a snow-clad mountain.

However, as per the recommendation of the 7th Pay Commission, soldiers can now receive ₹21,000 (for Jawans) to ₹42,500 (for Officers belonging to Level 9 and above) per month.

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Before the 7th Pay Commission; there were several allowances on the basis of Geographical locations such as Sunderban Allowance, Tribal Area Allowance, Special Compensatory (Remote Locality) Allowance or SCRLA. These allowances were functional within the country for a variety of reasons. However, the authorities have subsumed all these allowances in the 7th Pay Commission to form the Tough Location Allowance.

The purpose of this allowance was to provide additional financial support apart from basic pay to employees residing in different parts of India.

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Tough Location Allowance ranges from ₹1000 to ₹5300 every month. Individuals can receive this allowance after qualifying some parameters (such as location, profession).

This allowance is segregated into 3 categories namely, I, II, III.

• Category I- Remote localities that are too far to reach.
• Category II- Tribal areas that are poorer than others.
• Category III- Poor climate areas.

The Central Government allows individuals to choose the benefits of selecting Special Compensatory (Remote Locality) Allowance at previously revised rates of 6th Central Pay Commission along with Special Duty Allowance at a revised rate of 10% basic pay of 7th Pay Commission.

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Earlier, there were Robe Allowance, Kit Maintenance Allowance, Initial Equipment Allowance, Robe Maintenance Allowance, Washing Allowance, Shoe Allowance, Uniform Allowance, and Clothing Allowance. The 7th Pay Commission recommended subsuming all these allowances into Dress Allowance.

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Amount of Dress Allowances differ from one person to another as per profession and department such as Railways, Defense, Military Nursing Service officer, IFS officer, an officer of the Navy, Indian Army, central police organisations, Air Force, central armed police forces, coast guards.

Other personnel include Indian Corporate Law Service officers, the executive staff of customs, legal officers in National Investigation Agency, Bureau of Immigration personnel in Delhi, Amritsar, Kolkata, Mumbai, Chennai, and all other foreigners’ entry checkpoints etc.

Please note that the Dress Allowance rate will increase by 25% every time Dearness Allowance soars by 50%.

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The 6th Pay Commission recommended the Central Government to undertake houses on a long lease to offer accommodation to individuals against 10% of their basic pay. This Commission also asked the Central Government to state appropriate rates on HRA in different cities and towns based on ongoing rent levels in cities and towns.

Further, this Commission also recommended prescribing particular rents for different accommodation types for officers and personnel in specific cities after evaluating or studying the current condition.

We have reached the end of this piece with a detailed discussion on various allowances and the 7th Pay Commission HRA table. Central Government employees, especially new joiners, must read this information attentively to understand the importance and relevance of multiple allowances.

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