Thursday, March 23, 2017

7th Pay Commission: Can Narendra Modi government gift you higher allowances from April?  | New Delhi, March 21, 2017

All hope may not be lost for Central government employees who were expecting the government to make an announcement on higher allowances under the Seventh Pay Commission after the election season.According to some media reports, the Committee on Allowances headed by Finance Secretary Ashok Lavasa may submit its report before the end of this month, giving a glimmer of hope to employees who can expect to get revised allowances from April.

The Committee on Allowances missed its earlier February 22 deadline for submitting its review report on the recommendations by the Seventh Pay Commission on allowances.

  1. Replying to a question on Seventh Pay Commission in Lok Sabha on March 10, Minister of State for Finance Arjun Ram Meghwal had said the committee on higher allowances was yet to submit its report. The minister, however, added that deliberations with the committee were in the final stage.
  2. The Committee on Allowances was formed in July last year after government employees protested against the recommendations of the Seventh Pay Commission. The commission had recommended scrapping 53 of the 196 allowances for government employees and also suggested merging a few others.
  3. The Ashok Lavasa-led committee was given four months' time to submit its review report on the recommendations made by the Seventh Pay Commission. The deadline for report submission was later extended to February 22, 2017. 
  4. Allowances form a significant part of a government employee's salary and the delay in announcement on a proposed hike has led to growing resentment among nearly 50 lakh employees.
  5. It was believed that once the model code of conduct was lifted following the end of the elections in five states, the government would soon make an announcement on higher allowances.
  6. The second part of the Budget session is still on and the Committee on Allowances, as per some media reports, is expected to submit its report before the end of March. If the recommendations are implemented by month-end, employees can expect to get revised salaries from April. 
  7. Among allowances, the Lavasa committee's recommendation on house rent allowance will be most-closely followed. HRA is one of the fatter allowances that employees get and the Seventh Pay Commission had recommended reducing it by 2-6 per cent depending on type of cities.
  8. If reports are to be believed, the Committee on Allowances is likely to recommend no changes in HRA, keeping them as they were under the Sixth Pay Commission at 10, 20 and 30 per cent for different tiers of cities.

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