Finance Ministry has discontinued seven interest-free advances that employees were entitled to avail.
The 7th pay commission gave government employees a hike in salaries, but a new recommendation by the panel has ended some of the age-old benefits that came with government jobs.
The Finance Ministry has discontinued seven interest-free advances that employees were entitled to avail. The employees were earlier allowed to take advance salaries for the purchase certain articles such as warm clothing and during festivities and natural calamity.
Employees will also not be able to avail advance of leave salary, advance for law suits and advance of pay on transfer and training in Hindi through correspondence courses. Advances bearing interests such as for buying a two or a four wheeler have also been discontinued. The new rules notifying the discontinued interest free advances were released by the expenditure department of the finance ministry.
Even though the 7th Pay Commission had recommended all interest free advances given to employees be abolished, employees will continue to get interest free advances for medical treatment, travelling allowance for family members of deceased, leave travel concession (LTC) and advance for buying computers, but under an upper limit of Rs 50,000. And if an employee spends an average 35 years in service - retirement age of 60 - the advance can be availed five times in the service period.
The 7th pay commission recommendations enabled a 2.57-time hike in the basic salary of almost 1 crore employees and pensioners, effective from January 1, 2016.