Published On: Sat, Nov 21st, 2015

Seventh Pay Commission proposes no hike in Transport allowance, but huge in HRA

Finance Minister Arun Jaitley received the Pay Commission report on Thursday.

Finance Minister Arun Jaitley

New Delhi: The Seventh Pay Commission proposed no hike in Transport Allowance (TPTA) for central government employees in its report, which was submitted to Finance Minister Arun Jaitley, but this has been balanced by 106 to 122 percent hike in House Rent Allowance (HRA).

The Pay Commission has revised the Transport allowance (TPTA), which is given below:-

NEW TPTA

The existing Transport allowance table for A1/A cities and other places is under:-

Existing TPTA

 

The Pay Commission made report, assuming that the rate of Dearness Allowance would be 125 percent at the time of implementation of the pay commission recommendation, i.e. on January 1 next year.

Accordingly, the employees will not get any hike in Transport allowance on the time of implementation of the pay commission recommendation as the existing Transport allowance figure automatically reaches the Pay Commission revised Transport allowance figure after adding 125 percent DA.

However, the employees drawing Grade pay Rs 2,000, Rs 2,400 and Rs 2,800, who are placed Level 3, Level 4 and Level 5 in the pay commission recommended pay matrix, will get higher Transport allowance in the new scenario, as they are upgraded for Transport allowance.

The employees with Grade Pay Rs 1,800 and 1,900, who are placed Level 1 and Level 2 in the pay commission recommended pay matrix, posted other than A1/A cities, will get a great benefit of 175 percent (300-125) hike in Transport allowance segment.

House Rent Allowance (HRA) segment is of great benefit to central government employees in this pay commission.This segment will more than double, with the increases ranging between 106% and 122%.

The existing rates of HRA for Class X, Y and Z cities and towns are 30%, 20% and 10% of Basic pay (pay in the pay band plus grade pay). While the pay commission has revised the rates HRA for these cities to 24%, 16% and 8% respectively of new Basic pay (pay in the pay band plus grade pay multiplying by a factor of 2.57).

So the HRA segment will rise dramatically more than 100 percent of the existing House Rent Allowance (HRA).

New HRA will rise to 27%, 18% and 9% for the three classes of cities when the dearness allowance crosses 50% and to 30%, 20% and 10% when it reaches 100%.

Read Also: Seventh Pay Commission to propose higher HRA

TST

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