Admissibility of House Rent Allowance (HRA) in the event of non-acceptance or surrender of railway residential accommodation

Admissibility of House Rent Allowance (HRA) in the event of non-acceptance or surrender of railway residential accommodation

GOVERNMENT OF INDIA
MINISTRY OF RAILWAYS
RAILWAY BOARD

No.E(P&A)II/2012/F.E.2/4
The General Manager,
All Indian Railways/PUs, NF(Con), CORE
The DG/RDSO/Lucknow, DG/NAIR/Vadodara
CA0s,DMW/Patia1a, WPO/Patna, COFMOW/NDLS, RWP/Bela, CAO/IROAF

Dated: 02.04.2019

Sub: Admissibility of House Rent Allowance (HRA) in the event of non-acceptance or surrender of railway residential accommodation.

Ref:
(1) Department of Expenditures, MoFs 0M No.2/5/2017-E.IIB dated 05.03.2019
(2) Rai1way Board’s letter No.E(P&A)II-87/HRA-15, dated 16.5.1988
(3) Rai1way Board’s No.E(P&A)II-95/HRA-3, dated 14.02.1996
(4) Rai1way Board’s letter No.E(P&A)II-99/HRA-2, dated 12.07.1999 & 16.03.2000
(5) Rai1way Board’s letter No.E(P&A)II-2002/HRA-4, dated 16.10.2002 & 09.05.2003
(6) Rai1way Board’s No.E(P&A)II-2010/HRA-2, dated 08.12.2010
(7) Rai1way Board’s letter No.E(P&A)II-2017/HRA-3, dated 15.01.2018

With reference to Department of Expenditure, Ministry of Finance’s Office Memorandum at (I) & other Railway Board’s references above, Board (MS, FC & CRB) have approved the following:
For other than those Railway employees (officers and staff) for whom accommodation is specially earmarked and whose occupation of railway quarter is essential for easy accessibility during emergencies, efficient discharge of their duties, et., the condition of Applying for Government Accommodation and furnishing of ‘No Accommodation Certificate’ by Employees to become eligible for HRA may be dispensed with and Department of Expenditure. MoF’s letter under reference may be made applicable Mutatis Mutandis is for such categories of Railway employees.
Railway accommodation so vacated may be allotted to other employees of the same pool or other pool or Essential category employees by changing the pool, if required, by the Zonal Railway. The Quarter-allotment Authority shall promptly take necessary action in this regard.

Other extant instructions/guidelines issued from Board on the subject shall remain unchanged as modified from time to time.

Department of Expenditure, MoF’s letter under ref. (1) is enclosed for ready reference.

This issues with the concurrence of Associate Finance of Transformation Cell Of Railway Board.
Kindly acknowledge the receipt and ensure compliance.

sd/-
(Umesh Balonda)
Executive Director/S&T)
Transformation Cell

House Rent Allowance (HRA) : Report of the Committee on Allowances

House Rent Allowance (HRA) : Report of the Committee on Allowances

House Rent Allowance (HRA) (Para 8.7.3-16)

Existing Provisions: HRA is paid @30, 20 and 10 percent for X class (50 Lakh & above), Y class (5 to 50 lakh) and Z class (below 5 lakh) cities respectively.

At present, in the case of those drawing either NPA or MSP or both, HRA is being paid as a percentage of BP+NPA or BP+MSP or BP+NPA+MSP respectively.

Recommendations of 7th CPC: It has been retained and rationalized. After applying a multiplication factor of 0.8, the rates have been revised downwards to 24 percent, 16 percent and 8 percent of the Basic Pay for X, Y and Z class cities, respectively.

The rate of HRA will be revised to 27 percent, 18 percent and 9 percent when DA crosses 50 percent, and further revised to 30 percent, 20 percent and 10 percent when DA crosses 100 percent. Add-ons like NPA, MSP, etc. should not be included while working out HRA.

Demands:

I. National Council (Staff Side), JCM: HRA may be retained @30%, 20% and 10% for X, Y and Z cities respectively as the Commission has taken unreliable statistics to determine HRA, which has been reduced by a multiplication factor of 0.8 to 24%, 16% and 8% for X, Y and Z cities respectively.

II. CAG, Civil Aviation, M/o Health & FW, M/o HRD - D/o of Higher Education, MEA, Coal, DAE, DRDO, Dep. Of Space, CVC: Retain the allowance at the existing rates.

III. M/o of Law & Justice- D/o Justice: Cities having population of more than 1 crore may be granted HRA @ 30%.

Analysis and Recommendations of the Committee: The Committee has the following observations on the recommendations of the 7th CPC on HRA:

(I) HRA rates have been revised downwards by applying the multiplication factor of 0.8 applied by the 7th CPC on all percentage- based allowances. This was done to neutralise the significant increase in the Basic Pay. All fixed allowances have only been given an inflation indexed increase by the 7th CPC. While the 7th CPC has not explicitly stated how the multiplication factor of 0.8 has been arrived at anywhere in the Report, it may be seen that factoring in the expected Dearness Allowance of 125% on 01.01. 2016 would have yielded a multiplication factor of 0.875 which may have been rounded off to 0.8.

(II) On the 7th CPC recommendation that the rate of HRA will be revised to 27%, 18% and 9% when DA crosses 50 percent and further revised to 30%, 20% & 10% when DA crosses 100%, the Committee is of the view that given the inflation rates since January 2016 and the RBI policy on inflation, the DA rates might not go beyond 50% in the next 10 years.

(III) While the rents for residential accommodation have not gone up significantly in the recent past and might also have fallen in some areas, the HRA at the rates recommended by the 7th CPC at the lower levels might not continue to be adequate as per the prevailing market rent.

In view of these observations, the Committee has deliberated upon the following three options which separately, or in combination, can be suggested by way of modifications to the 7th CPC recommendations:

Option (i): Having regard to submissions made before it stating that towards the later part of the ten year period, HRA compensation falls considerably short of requirement, the 7th CPC has recommended that the rate of HRA will be revised to 27 percent, 18 percent and 9 percent when DA crosses 50 percent, and further revised to 30 percent, 20 percent and 10 percent when DA crosses 100 percent. However, considering the present inflation rate, the rate of increase of the Dearness Allowance and future inflation projections, it appears unlikely that DA rates will reach 100 % in the ten year period. Taking this into consideration, the Committee considered that the timing of the upward revisions in HRA rates proposed by the 7th CPC may be advanced as under:

This would have no immediate financial implication and the 1st revision, as per the current trend of increase in DA, is expected to occur in July, 2018. Accordingly, additional annual financial implication in July, 2018 will be approximately Rs.1850 crore. The additional financial implication in the second, third and fourth revision will also be
approximately Rs.1850 crore per annum.

Option (ii): Instead of advancing the full restoration of HRA rates, the Committee considered splitting the revisions proposed by 7th CPC as under:

The financial implication would be similar as in Option (i) except that the timing of the revision would undergo a change.

Option (iii): It has been pointed out that at the recommended rates, HRA at the minimum level might not be sufficient. The minimum HRA calculated at the entry level of Level 1for X, Y and Z category cities at the rates recommended by the 7th CPC will be Rs.4320, Rs.2880 and Rs.1440 respectively. The Committee considered recommending that the HRA at the rates recommended by the 7th CPC may be subject to a floor which may be fixed at Rs.5400, Rs.3600 and Rs.1800 per month, calculated at 30%, 20% and 10% of the minimum pay for X, Y and Z category cities respectively. This will benefit employees in Levels 1, 2 and 3.

The additional financial implication is estimated to be Rs. 385.00 crore and around 7.70 lakh employees shall be benefited. After a detailed consideration of the above options, the Committee recommended that either only option (iii) or option (iii) in combination with option 

(ii) be accepted. A final decision in this regard may be taken by E-CoS.

Authority: www.doe.gov.in

Click to view the Report

Allowance Committee and JCM NC Standing Committee meetings postponed to 25.10.2016

Allowance Committee and JCM NC Standing Committee meetings postponed to 25.10.2016

ALLOWANCE COMMITTEE MEETING & JCM NATIONAL COUNCIL STANDING COMMITTEE MEETINGS POSTPONED TO 25th OCTOBER 2016

GOVERNMENT INFORMED THAT MEETINGS OF THE ALLOWANCE COMMITTEE AND JCM NATIONAL COUNCIL STANDING COMMITTEE SCHEDULED TO BE HELD ON 13TH OCTOBER 2016 STANDS POSTPONED TO 25th OCTOBER 2016

M.Krishnan
Secretary General
Confederation
Mob: 09447068125
Email: mkrishnan6854@gmail.com

Source: Confederation Blog

7th CPC Allowances : Meeting with JCM Staff Side on 13.10.2016

7th CPC Allowances : Meeting with JCM Staff Side on 13.10.2016

MEETING UNDER THE CHAIRMANSHIP OF SECRETARY (P) WITH THE SECRETARY STAFF SIDE, (NC) JCM TO FIRM THE VIEW ON VARIOUS ALLOWANCES PERTAINING TO DEPARTMENT OF PERSONNEL & TRAINING ON 13.10.2016 AT 3.00 PM.

IMMEDIATE
MEETING NOTICE

No.6/8/2016-PIC
Government of India
Ministry of Personnel, PG & Pensions
Department of Personnel & Training

North Block, New Delhi
Dated: 30th September, 2016

OFFICE MEMORANDUM

Subject: Meeting under the Chairmanship of Secretary (P) with the Secretary Staff Side, NC (JCM) to firm up the view on various allowances pertaining to Department of Personnel & Training on 13/10/2016 at 3.00 PM

The undersigned is directed to refer to Department of Expenditure’s meeting of committee on Allowances held on 01.09.2016 and to say that a meeting to discuss the various allowances pertaining to DoPT is scheduled to be held under the Chairpersonship of Secretary (P) on 13th October, 2016 at 15.00 Hrs in Room No.190, North Block, New Delhi.

2. It is requested to kindly make it convenient to attend the meeting.

sd/-
(D.K.Sengupta)
Deputy Secretary (CPC)

Source: Confederation

Payment of Allowances in Revised pay may satisfy the Government Staff

Payment of Allowances in Revised pay may satisfy the Government Staff

It is believed that Payment of Allowances in Revised pay may at least satisfy the Government Staff, despite the fact that the Pay Hike is not sufficient.7th CPC Allowances

Bapus are annoyed about the inordinate delay in announcing Allowances. Talks are doing rounds that the government is deliberately playing the delaying tactics to make the CG Staff to accept the decisions of Allowance Committee.

Central Staff upset with Pay Hike

Already the Central Government Staff are very much upset with Pay Hike recommended for next Ten Long years. They in fact are not happy about the Arrears paid to them. Though the Govt has defended that the Pay Revision arrears will not be as high as in previous Pay Commission, because Arrears for couple of years had been paid in previous Pay Commission. But this time Pay Revision took place within seven months from the due date. So obviously the Pay Revision Arrears will be lesser than previous Pay Commission.

Though a Committee was formed to review the Minimum Pay and Fitment Factor, it is believed that it was wrapped up already. But the federations are Optimistic. They expect somehow the Committee will help them to pacify the Govt Servants on this particular issue.

But nonpayment of Allowances in revised Pay will certainly axe the feel good factor in Central Government Offices. They are started losing patience over it and expect the government to announce it soon. Because the take home pay after pay revision is unbelievably very low comparing to the previous Pay commission. The Central government should not reduce the rate of Allowances and it should be implemented with effect from 1.1.2016

Source: http://govtstaffnews.in/

House Rent Allowance (HRA) Calculations after implementation of 7th CPC

House Rent Allowance (HRA) Calculations after implementation of 7^th CPC…

The Union Cabinet finally cleared the 7^th Central Pay Commission for implementation on the 29^th of July 2016. The Report which recommended a hike in salaries and pension for employees and pensioners, will be implemented from 1^st January 2016. After taking into account dearness allowance at the prevailing rate, the salary, pension to all central government employees and pensioners will increase by at least 14.29 % as on January 2016, and could go up to 23 % in upper categories.

 The union cabinet approved the recommendations of the 7^th CPC on pay and pension but proposals for allowances was deferred and announced a committee under the finance secretary. The committee will analyse the allowances to be implemented or scraped. So the allowances like HRA, TA etc. will continue at existing rates for now.

 Regarding the HRA at present, it is 30 % for class X cities, 20% for Y cities, and 10% for Z class cities. However, in the 7^th CPC report it was recommended that the HRA should paid at the rate of 24%, 16% and 8% of the new basic pay for X, Y and Z category of cities respectively. The commission had recommended a rise in HRA when the DA crosses 50% to 27%, 18% and 9% and further increase to 30%, 20% and 10% when the DA crosses 100%.

 Now the allowances including HRA will be kept under the newly formed committee, there will be a huge confusion when calculating allowances including the HRA. On what basis will the HRA be calculated if the new recommendations are implemented?

 For example,

6th CPC Pay in the pay band	Grade Pay	Basic Pay	HRA @30%	7th CPC Basic pay	HRA @ 24%
Rs.13690	Rs.4200	Rs.17890	Rs.5367	Rs.46200	Rs.11088
Rs.10000	Rs.2000	Rs.12000	Rs.3600	Rs.30840	Rs.7464

Let us wait and see for the government orders regarding the calculations!!!!

Grant of HRA at a higher rate (“B” Category) to the Central Government Servants Posted at Aizawl (Mizoram)

Grant of HRA at a higher rate (“B” Category) to the Central Government Servants Posted at Aizawl (Mizoram) – Court Case regarding

RD570050807IN

COURT-CASE
MOST URGENT

F.No.4-23/2000-PAP
GOVERNMENT OF INDIA
MINISTRY OF COMMUNICATION & IT
DEPARTMENT OF POSTS
(ESTABLISHMENT DIVISION)/P.A.P.SECTION
DAK BHAWAN, SANSAD MARG, NEW DELHI – 110 001

DATED, THE 01ST MARCH, 2016.

TO

The Chief Post Master General
N.E.Postal Circle
Shillong – 793001

ORDER

Subject: Grant of HRA at a higher rate (‘B’ Category) to the Central Government Servants Posted at Aizawl (Mizoram) – Court Case regarding.

Central Government Employees Federation of Mizoram, General Head Quarters, Aizawl, Mizoram made a representation to the Hon’ble Prime Minister of India claiming House Rent Allowance at “B” Class City rates and Compensation in lieu of Rent Free Accommodation at the rate of 10% to the Central Government Employees Posted in Mizoram State based on the judgement passed by Supreme court of India in Civil Appeal No.2715/91-Union of India & Ors V/s Shri S.K.Ghosh & Others and Department of Posts Order No.8-40/87-PAP dated 7.3.1994 & No.4-52/98-PAP dated 27.02.1999. On rejection of their claim, the Central Government Employees posted in the State of Mizoram approached the Central Administrative Tribunal, Guwahati under O.A.No.381/2000. The Hon’ble CAT, in Para -5 of its order dated 12.04.2002 pronounced as under:-

“In view of the position enumerated above,I am of the-view that the applicants are entitled to House Rent Allowance at the rate prescribed for B class cities to the Central Government Employees which should be payable to the applicants at the rate of 15% from 1.1.1986 to 30.9.1986 and from 1.10.86 to 30.9.1986 and from 1.10.86 to 30.9.86 and from 1.10.1986 at flat rate prescribed under O.M.dated 7.8.1987 read with another O.M.dated 13.11.1987 and the Notification GSR No.623 (E) amending the Fundamental Rule 45 A with effect from 1.7.1987.

As regards the claim for compensation in lieu of Rent Free Accommodation the respondents are to act in conformity with the Office Memorandum No.12-11/60-ACC-I dated 2.8.1960,O.M.dated 23.2.1986 and 22.5.1987 and also to O.M.dated 13.11.1987. The respondents shall examine the each case on merits and thereafter shall pass necessary order in individual cases. Rent free unfurnished accommodation is admissible to Central Government Employees having all India transfer liability only those who are posted in Mizoram or HRA at the rate prescribed from time to time. Compensation and admissible HRA shall be granted to those persons who are entitled to rent free accommodation and could not be provided accommodation and the above benefit shall be granted only to the Central Government employees having all India Transfer liability and Posted in Mizoram vide letter No.11015/1/E/(B)/76 dated 31.7.1977. The respondents shall examine the individual cases and thereafter pass necessary orders in those Cases, others will not be eligible for the same.The application is allowed in part, No Costs”.

2. The Department filed WP No.2955/2003 in the Hon’ble High Court of Guwahati against the orders of the CAT dated 12.04.2002. The Hon’ble High court in its judgment dated 25.4.2003, “disposed of the appeal with the observations that the directions given by the Learned Tribunal in the last part of the judgment quoted above shall be complied with by the Central Government after taking due consideration of the observations recorded within a period of 6 Months. The High court observed that the case of each and every Central Government employee posted in the state of Mizoram will have to be taken separately and appropriate orders shall be passed thereon after such consideration in terms of OM dated 23.09.86, 19.03.87 and 13.11.87. The Hon’ble High court, however, observed that the employees posted in Aizawl Headquarters of the State of Mizoram being a “C”Class city may not be entitled to HRA as prescribed for “B” class cities.”

3. Aggrieved by the order of the Hon’ble High Court of Guwahati, the Central Government Employees filed a civil appeal No.646/2005 in the Supreme Court of India. The Supreme court stayed the operation of the judgment order dated 25.04.2003 of the high court of Guwahati in WP No.2955/2003. The Honble supreme Court of India has dismissed the civil appeal and passed the orders dated 17.07.2013 as under:-

“We have thoughtfully considered the submissions of the learned counsel. In our view, the direction given by the Tribunal, which has been confirmed by the High Court, merely ordains consideration of the cases of each employee for grant of City compensatory Allowance in accordance with O.M. dated 02.08.1960, O.M. dated 23.02.1986 and 2.5.1987 as also O.M.dated 13.11.1987 and nothing more. Therefore, the impugned order as also the one passed by the Tribunal do not call for interference by this court under Article 136 of the Constitution.

With the above observation, the appeal is dismissed.

However, it is made clear that if the Government of India has issued fresh instructions after 13.11.1987 then the cases of the respondents shall be considered in accordance with the latest instructions.”

4. Consequent upon obtaining the concurrence of Integrated Finance Wing of this Department, the, matter was referred to Ministry of Finance, Department of Expenditure for decision.

5. Ministry of Finance, Department of Expenditure has considered the matter and accorded their approval in view of the decision taken by the Department of Posts to not to file any Review petition in the matter and as the Ministry of Law & Justice has advised Department of Posts to take administrative decision for implementation of the said order of Hon’ble Tribunal, implementation of the Order dated 12.04.2002 passed by the Hon’ble CAT, Guwahati Bench in O.A.No.381/2000 for grant of House Rent Allowance at “B/Y” class cities rates, as admissible from time to time, is agreed to.

6. Since, the Department of Posts had represented the Union of India on behalf of all the respondents Ministries/Departments/Offices, the approval accorded by the Department of Expenditure, Ministry of Finance is therefore conveyed to all the Respondent Ministries/Departments/Offices for issuing appropriate instructions for compliance of orders dated 12.04.2002 of Hon’ble CAT, Guwahati Bench in respect of the employees working under their administrative control who were/are applicants in the said OA No.381/2000.

7. This has the approval of the Competent Authority.

sd/-
(K.V.Vijayakumar)
Assistant Director General (Estt.)

Source: http://aipeup3bbsr.blogspot.in/

Analysis and Recommendations of 7th Pay Commission on House Rent Allowance

Allowances related to Housing  : House Rent Allowance (HRA) : Presently, HRA is payable at the following rates:

There are a large number of demands for paying HRA as a percentage of (Basic Pay + DA), instead of as a percentage of Basic Pay alone, as at present. Representations have also been received regarding enhancement of percentage rates and having only two classifications of Metros and Non-metros (instead of the present classification of X, Y and Z cities).

PBORs of uniformed forces have vehemently argued for doing away with the concept of Authorized Married Establishment and the requirement of a minimum age of 25 years for grant of Compensation in Lieu of Quarters (CILQ).

Analysis and Recommendations: Compensation towards the housing needs of Central Government employees is covered in three ways:

1. As a component of Basic Pay when it is initially fixed (based upon the Aykroyd formula)
2. As a constituent of Dearness Allowance [the AICPI(IW), on which the DA is currently based includes a weight of 15.27% towards housing], and
3. In the form of House Rent Allowance

In view of the fact that the DA calculation methodology that is being followed does include a certain weightage for housing, the demand to pay HRA as a percentage of Basic Pay + DA is not justified.

To arrive at the appropriate rates of HRA, the Commission used a two-fold approach: (i) It compared the rise in housing compensation with the cost of housing in major X, Y and Z category cities over the period 2006 to 2013, and (ii) It compared, de novo, the HRA after the rise in Basic Pay proposed with representative house rents in major X, Y and Z category cities.

For (i) above, the table of comparison (for a hypothetical employee whose Basic Pay was Rs.1000 in 2006) is given below:

As is clear from the above table, compensation for housing in 2013 was 1.79 times that in 2006 for Class X cities, 2.07 times for Class Y cities and 2.92 times for Class Z cities.

During the same period, the weighted (by population of cities) average rise31 in housing index for Class X cities was 1.69 times, for thirty most populated Class Y cities it was 2.10 times, and for twenty-five most populated Class Z cities it was also 2.10 times.

Thus, it can be safely concluded that the rise in housing compensation has largely kept pace with the rise in rental values in all categories of cities.

However, if a zero-based comparison of HRA with house rents is carried out the Commission observed that today there are websites that give a good idea of the prevalent house rents in various cities. From the information available on the websites, it was observed that with the increase in Basic Pay proposed (and consequent rise in HRA with the rationalized percentages), most of the employees will be able to afford a rented house as per their entitlement.

The Commission also took note of the link between increase in HRA and increase in house rent. There was a sharp rise in the index from the first half of 2009, immediately following VI CPC recommendations. The All India House Rent Index32 chart given below demonstrates this:

Considering all these factors, and in line with our general policy of rationalizing the percentage based allowances by a factor of 0.8, the Commission recommends that HRA should be rationalized to 24 percent, 16 percent and 8 percent of the Basic Pay for Class X, Y and Z cities respectively.

However, the Commission also recognizes that with the current formulation, once the new pay levels are implemented, the compensation towards HRA will remain unchanged until such time as the pay and allowances are next revised. Going by the historical trend this event is likely to be a decade away. Some representations have been received stating that towards the later part of the ten year period the HRA compensation falls considerably short of the requirement. Having regard to this, the Commission also recommends that the rate of HRA will be revised to 27 percent, 18 percent and 9 percent when DA crosses 50 percent, and further revised to 30 percent, 20 percent and 10 percent when DA crosses 100 percent.

Currently, in the case of those drawing either NPA or MSP or both, HRA is being paid as a percentage of Basic Pay+NPA or Basic Pay+MSP or Basic Pay+NPA+MSP respectively. HRA is a compensation for expenses in connection with the rent of the residential accommodation to be hired/leased by the employee and is graded based on the level of the employee, and therefore should be calculated as a percentage of Basic Pay only. Add-ons like NPA, MSP, etc. should not be included while working out HRA.

Keyword: HRA, House Rent Allowance, 7th CPC HRA, 7th CPC House Rent Allowance, 7th Central Pay Commission, 7th CPC Report, HOUSE RENT ALLOWANCE

7th CPC recommendations to reduce House Rent Allowance

7th CPC recommendations to reduce House Rent Allowance

The 7th Central Pay Commission has been recommended to reduce the percentage of House Rent Allowance for all categories of Central Government employees rationalized to 24 percent, 16 percent and 8 percent of the Basic Pay for Class X, Y and Z cities respectively.

The Commission also recommends that the rate of HRA will be revised to 27 percent, 18 percent and 9 percent when DA crosses 50 percent, and further revised to 30 percent, 20 percent and 10 percent when DA crosses 100 percent.

7th CPC HRA: HRA is the most important factor of allowance issuing to existing Central Government employees, it is given for compensate to live in rented house. The HRA rules are allowed for getting allowance even if he/she living in own house.

A major changes had been made in 6th CPC on HRA rules. The percentages were prescribed on basic pay according to the cities in India. The cities are classified as X, Y and Z and the rates of percentage respect of the cities are 30%, 20% and 10% on basic pay (Grade pay including).

Central Government employees are expecting changes in the rate of percentage according to cities.

NC JCM STAFF SIDE SUGGESTION ON HOUSE RENT ALLOWANCE

National Council JCM Staff Side given suggestion on House Rent Allowance for Central Government employees as under…

House Rent allowance. 

The present scheme of HRA is based on the recommendation of the 6th CPC, which is as follows:

We reproduce hereunder the recommendation made by the third Central Pay Commission in the matter of grant of house rent allowance. (Para 29 Part I. Vol. IV.Chapter 56), which would be the best if implemented even today. While we find it difficult to accept the kind of parity suggested above, we are aware of the acute problem caused by the lack of adequate government housing and by the inadequate government housing and by the inadequacy of the existing rates of house rent allowance and recommend as follows:-

Government should take houses on long lease and make residential accommodation available to its employees on payment of 10% of their pay.

(ii) Government should lay down appropriate house rent allowance rates in different cities and towns based not on population criteria, but on an actual assessment of the prevailing levels of rent in different cities and towns. Alternatively, certain notional rents for different types of accommodation meant for officers and personnel of specified pay groups should be laid down for particular cities after studying the actual conditions in that city. The difference between the actual rent paid and 10% of pay should be reimbursed subject to a maximum of the difference between the notional rent and 10% of the pay. The existing norms in regard to entitlement of accommodation, size of rooms etc. could, if necessary, be reduced depending on the housing situation and the norms usually adopted by different income groups in renting accommodation in the various cities. Such notional rents should, to start with, be applied to all stations falling under the description of classified cities for purposes of House Rent Allowance, Additions could also be made to the list later on by including other cities deserving similar treatment.

 (iii) Till the Government is able to make arrangements recommended in the preceding sub-paragraphs, the rates of HRA should be as follows:-

The above said recommendations is still to be acted upon by the Government and the transitory provisions suggested by them i.e. payment of allowances at a pre-determined rate on the basis of classification made of the cities depending upon the population continue to be employed. The non-implementation of the above recommendation of the third CPC , has without exception, gone to depress the wage of all sections of Central Government employees as they are perforce to spend more than what they receive as HRA for obtaining and retaining the accommodation.

The rates prescribed by the 6th CPC, though an improvement over its predecessor Commission, it has not improved the situation. The real estate value throughout the country has skyrocketed and owning an accommodation within the city/Municipal limit has become impossible for Government employees. There is not a single town/village where the real estate boom has remained unaffected. The phenomenal increase in the value of land has naturally impacted the rent, one is to pay on leasing house/flat. The house rent allowance does not bear even a small percentage of the rent. The 7th CPC may recommend to the Government to act upon the suggestion made by the 3rd CPC without any further delay. Pending action on the part of the Government, the Commission may suggest the following rates of House Rent allowance;

 

Source: 7thpaycommissionnews.in