7th Pay Commission – House Rent Allowance after Cabinet Approval

The 7th pay panel headed by AK Mathur had recommended that HRA should be rationalized by a factor of 0.8, the Commission also 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.

But, the Cabinet committee not taken any decision on the allowances part, so the Cabinet decided to constitute a Committee headed by Finance Secretary for further examination of the recommendations of 7th CPC on Allowances.

The Committee will complete its work in a time bound manner and submit its reports within a period of 4 months. Till a final decision, all existing Allowances will continue to be paid at the existing rates

Existing HRA Rates :

Population of Cities/Towns	Class of Cities/Towns	HRA rates as % of Basic Pay (including MSP and NPA)
50 lakh and above	X	30
50–5 lakh	Y	20
Below 5 lakh	Z	10

Official Statement

The Commission examined a total of 196 existing Allowances and, by way of rationalization, recommended abolition of 51 Allowances and subsuming of 37 Allowances. Given the significant changes in the existing provisions for Allowances which may have wide ranging implications, the Cabinet decided to constitute a Committee headed by Finance Secretary for further examination of the recommendations of 7th CPC on Allowances. The Committee will complete its work in a time bound manner and submit its reports within a period of 4 months. Till a final decision, all existing Allowances will continue to be paid at the existing rates.”

House Rent Allowance comes under one of the 196 allowances, so there is no changes in the HRA for another 4 months

Source : igecorner.com