7th CPC may Propose increased HRA for Central government employees

For hra  for central government employees and  PSU employees Cities are classified as X, Y and Z, on the basis of their population, as recommended by the Sixth Central Pay Commission in 2008.

Before the Sixth Central Pay Commission, the classification of cities in India was based on two parameters — Compensatory City Allowance (CCA), further divided into categories A-1, A, B-1 and B-2, and hra, further divided into categories A-1, A, B-1, B-2 and C.

7thCPC may reintroduce Compensatory City Allowance (CCA)

Recently Finance ministry issued order for Upgradation of Cities / Towns on the basis of Census-2011 for hra calculation for CG employees

Finance Ministry's  order for Re-Classification / Upgradation of Cities / Towns on the basis of Census-2011 for the purpose of grant of House Rent Allowance (HRA) to Central Government employees.

Ministry of Heavy Industries & Public Enterprises Department of Public Enterprises also issued OFFICE MEMORANDUM for Revision of House Rent Allowance for CPSE

Ministry of Heavy Industries & Public Enterprises Department of Public Enterprises issues OFFICE MEMORANDUM for Revision of House Rent Allowance for CPSE employees on the basis of Census – 2011

Now Speculation are that the Seventh pay Commission may increase House Rent Allowance (hra) of central government and CPSU employees

Four different class of  cities may be proposed Instead of the existing three class for house rent calculation. ‘X’ class cities Ahmedabad, Bangalore, Chennai, Delhi, Hyderabad, Kolkata, Mumbai and Pune, where employees will get 40 percent of their basic salary as House Rent Allowance (hra), increasing from the existing 30 percent.

Employees posted at ‘Y’ class cities covers near about 90 stations, will receive 30 percent of basic salary, instead of the existing 20 percent.

A new class will be created for the district towns; the central government employees will get 20 percent of their basic salary as House Rent Allowance (hra) there.

In other areas, the house rent allowance will be 10 percent of basic, which is the existing rate of House Rent Allowance (hra) of ‘Z’ class cities.

currently population based hra classification

is 50 lakh and above for X,

5-50 lakh for Y

and below 5 lakh for Z class cities.

Comments

CLASSIFICATION OF CITIES FOR HRA

Population Criteria opted for classification of cities seems not to be justified.For example Sector located in Noida and Greater Noida are divided only by river Hindon.In spite of world,s best infrastructure available at Greater Noida, Rate of HRA in Noida is 30% whereas in Greater Noida is 10%.This anatomy may be looked and resolved by 7th CPC judiciously while making conclusive recommendations.

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