Central government employees will start getting revised allowances under the 7th pay commission from July onwards. In a decision which will increase House Rent Allowance (HRA) payouts to more than 7.5 lakh employees, the government has rejected earlier recommendations to cut HRA to 24 per cent for category 'X' of cities (cities with population of 50 lakh & above), 16 per cent for 'Y' (cities with population of 5 lakh to 50 lakh) and 8 per cent for 'Z' (with population below 5 lakh) as it is felt that HRA at the lower suggested rates may not be enough.
Hence, the government has decided that HRA shall not be less than Rs. 5,400 per month, Rs. 3,600 per month and Rs. 1,800 per month calculated at 30 per cent of minimum pay for X, 20 per cent for Y and 10 per cent for Z category of cities.
HRA shall be revised to 27 per cent, 18 per cent and 9 per cent of Basic Pay in X,Y and Z cities when Dearness Allowance (DA) crosses 25 per cent and further to 30 per cent, 20 per cent and 10 per cent of Basic Pay in X, Y and Z cities when DA crosses 50 per cent.
HRA accounts for bulk of the total allowances given to government employees.
paid from the current month - a move that will benefit around 48 lakh employees.
It has published allowances' list recommended by the 7th pay commission along with modifications as approved by the Government of India in Gazette of India.
Here's what the notification said: