The
Union Cabinet chaired by the Prime Minister Shri Narendra Modi approved the recommendations
of the 7th CPC on allowances with some modifications. The revised
rates of the allowances shall come into effect from 1st July, 2017
and shall affect more than 48 lakh central government
employees.
While
approving the recommendations of the 7th CPC on 29th
June, 2016, the Cabinet had decided to set up the Committee on Allowances (CoA)
in view of substantial changes in the existing provisions and a number of
representations received. The modifications are based on suggestions made by
the CoA in its Report submitted to Finance Minister on 27th April,
2017 and the Empowered Committee of Secretaries set up to screen the
recommendations of 7th CPC.
7th
CPC recommendations on Allowances
The 7th CPC had adopted a three-pronged
approach in examining a total of 197 allowances which involved an assessment of
the need for continuation of each allowance, appropriateness of the set of
people covered by the allowance and rationalisation which involved clubbing of
allowances with similar objectives. Based on the examination on these lines,
the 7th CPC recommended that 53 allowances be abolished and 37 be
subsumed in an existing or a newly proposed allowance.
For most of the allowances that were retained, the 7th
CPC recommended a raise commensurate with inflation as reflected in the rates
of Dearness Allowance (DA). Accordingly, fully DA-indexed allowances such as
Transport Allowance were not given any raise. Allowances not indexed to DA were
raised by a factor of 2.25 and the partially indexed ones by a factor of 1.5.
The quantum of allowances paid as a percentage of pay was rationalised by a
factor of 0.8.
A new paradigm has been evolved to administer the
allowances linked to risk and hardship. The myriad allowances, their categories
and sub–categories pertaining to civilians employees, CAPF and defence
personnel have been fitted into a table called the Risk and Hardship Matrix
(R&H Matrix). The Matrix has nine cells denoting varying degrees of risk
and hardship with one extra cell at the top named as RH - Max to include
Siachen Allowance. Multiple rates applicable to individual allowances will be
replaced by two slab rates for every cell of the R&H Matrix.
Modifications
approved by the Cabinet
The modifications approved today were finalised by
the E-CoS based on the recommendations of the CoA. The CoA had undertaken
extensive stakeholder consultations before finalising its recommendations. It
had interacted with Joint Consultative Machinery (Staff side) and
representatives from various staff associations. Most of the modifications are
on account of continuing requirement of some of the existing arrangements,
administrative exigencies and to further the rationalization of the allowances
structure.
Financial Implications
The
modifications approved by the Government in the recommendations of the 7th CPC
on allowances will lead to a modest increase of ₹1448.23
crore per annum over the projections made by the 7th CPC. The 7th CPC, in its
Report, had projected the additional financial implication on allowances at ₹29,300
crore per annum. The combined additional financial implication on account of
the 7th CPC recommendations along with the modifications approved by the
Cabinet is estimated at ₹30748.23
crore per annum.
Highlights of Cabinet
approval on Allowances
1.
Number of allowances recommended to be
abolished and subsumed:
Government has decided not to abolish 12 of the 53
allowances which were recommended to be abolished by the 7th CPC. The decision
to retain these allowances has been taken keeping in view the specific
functional requirements of Railways, Posts and Scientific Departments such as
Space and Atomic Energy. It has also been decided that 3 of the 37 allowances
recommended to be subsumed by the 7th CPC will continue as separate identities.
This has been done on account of the unique nature of these allowances. The
rates of these allowances have also been enhanced as per the formula adopted by
the 7th CPC.
This will benefit over one lakh employees belonging to specific
categories in Railways, Posts, Defence and Scientific Departments.
2.
House Rent Allowance
HRA is currently paid @ 30% for X (population of 50
lakh & above), 20% for Y (5 to 50 lakh) and 10% for Z (below 5 lakh)
category of cities. 7th CPC has recommended reduction in the existing rates to
24% for X, 16% for Y and 8% for Z category of cities. As the HRA at the reduced
rates may not be sufficient for employees falling in lower pay bracket, it has
been decided that HRA shall not be less than ₹5400,
₹3600 and ₹1800
for X, Y and Z category of cities respectively. This floor rate has been
calculated @ 30%, 20% and 10% of the minimum pay of ₹18000.
This will benefit more than 7.5 lakh employees belonging to Levels 1 to 3.
7th CPC had also recommended that HRA rates will be
revised upwards in two phases to 27%, 18% and 9% when DA crosses 50% and to
30%, 20% and 10% when DA crosses 100%. Keeping in view the current inflation
trends, the Government has decided that these rates will be revised upwards
when DA crosses 25% and 50% respectively. This will benefit all employees who
do not reside in government accommodation and get HRA.
3.
Siachen Allowance
7th CPC had
placed Siachen Allowance in the RH-Max cell of the R&H Matrix with two
slabs of ₹21,000
and ₹31,500.
Recognizing the extreme nature of risk and hardship faced by officers / PBORs
on continuous basis in Siachen, the Government has decided to further enhance
the rates of Siachen Allowance which will now go up from the existing rate from
₹14,000 to ₹30,000
per month for Jawans & JCOs (Level 8 and below) and from ₹21,000
to ₹42,500
per month for Officers (Level 9 and above). With this enhancement, Siachen
Allowance will become more than twice the existing rates. It will benefit
all the soldiers and officers of Indian Army who are posted in Siachen.
4.
Dress Allowance
At present, various types of allowances are paid for
provisioning and maintenance of uniforms/outfits such as Washing Allowance,
Uniform Allowance, Kit Maintenance Allowance, Outfit Allowance etc. These have
been rationalised and subsumed in newly proposed Dress Allowance to be paid
annually in four slabs @ ₹5000,
₹10,000, ₹15,000
and ₹20,000
per annum for various category of employees. This
allowance will continue to be paid to Nurses on a monthly basis in view of high
maintenance and hygiene requirements. Government has decided to pay higher rate
of Dress Allowance to SPG personnel keeping in view the existing rates of
Uniform Allowance paid to them (which is higher than the rates recommended by
the 7th CPC) as also their specific requirements. The rates for specific
clothing for different categories of employees will be governed separately.
5.
Tough Location Allowance
Some allowances based on geographical location such
as Special Compensatory (Remote Locality) Allowance (SCRLA), Sunderban
Allowance & Tribal Area Allowance have been subsumed in Tough Location
Allowance. The areas under TLA have been classified into three categories and
the rates will be governed as per different cells of R&H Matrix and will be
in the range of ₹1000
- ₹5300 per month.
The 7th CPC had recommended that TLA will not be admissible with Special Duty
Allowance (SDA) payable in North-East, Ladakh and the Islands. Government has
decided that employees will be given the option to avail of the benefit of
SCRLA at pre-revised rates along with SDA at revised rates.
6.
Recommendations in respect of some
important allowances paid to all employees:
(i)
Rate of Children Education
Allowance (CEA) has been increased from ₹1500
per month / child (max. 2) to ₹2250
per month / child (max.2). Hostel Subsidy will also go up from ₹4500
per month to ₹6750
per month.
(ii)
Existing rates of Special
Allowance for Child Care for Women with Disabilities has been doubled from ₹1500
per month to ₹3000
per month.
(iii)
Higher Qualification Incentive for
Civilians has been increased from ₹2000
- ₹10000 (Grant) to ₹10000
- ₹30000 (Grant).
7. Recommendations in respect of
some important allowances paid to Uniformed Services: Defence, CAPFs,
Police, Indian Coast Guard and Security Agencies
i.
The 7th CPC has recommended abolition of
Ration Money Allowance (RMA) and free ration to Defence officers posted
in peace areas. It has been decided that Ration Money Allowance will continue to
be paid to them and directly credited to their account. It will benefit 43000
Defence officers.
ii.
Technical Allowance (Tier -
I & II) are paid to Defence
officers belonging to technical branches @₹3000 per month and ₹4500 per month. 7th CPC has recommended that Technical Allowance
(Tier - II) be merged with Higher Qualification Incentive for Defence
personnel. In view of the specific requirements of Defence Forces for the
Defence personnel to keep pace with changing Defence requirements and
technologies, the Government has decided not to discontinue Technical
Allowance. The list of courses for these allowances will be reviewed to remain in
sync with the latest technical advancements in Defence.
iii.
The facility of one additional free
railway warrant (Leave Travel Concession) presently granted
to personnel of Defence Forces serving in field/high altitude/CI Ops shall
also be extended to all personnels of CAPFs and the Indian Coast Guard.
iv.
Rates of High Altitude Allowance granted to Defence Forces and
CAPF personnel will be governed by the R&H Matrix. The rates will go up from
₹810 - ₹16800 per month to ₹2700 – ₹25000 per month.
v.
Field Area Allowances are granted to Indian Army, Air
Force & CAPF personnel. The rates of Field Area Allowances (Modified Field,
Field & Highly Active) will be governed by the R&H Matrix. The rates
will go up from ₹1200 - ₹12600 per month to ₹6000 - ₹16900 per month. Classification
of field areas for this allowance will be done by Ministry of Defence for
Defence personnel and by Ministry of Home Affairs for CAPFs.
vi.
The rates of Counter Insurgency Ops
(CI Ops) Allowance, granted to Defence and CAPFs while deployed in counter
– insurgency operations will be governed by the R&H Matrix. The rates will
go up from ₹3000
- ₹11700 per month to ₹6000
– ₹16900 per month.
vii.
Rates of MARCOS and Chariot Allowance granted to marine commandos of
Indian Navy will be governed by the R&H Matrix. The rates will go up from ₹10500 - ₹15750 per month to ₹17300 – ₹25000 per month.
viii.
Rates of Sea Going Allowance granted to personnel of Indian
Navy will be governed by the R&H Matrix. The twelve hour conditionality
for determining the eligibility of Sea Going Allowance has been reduced to four
hours. The rates will go up from ₹3000 - ₹7800 per month to ₹6000 – ₹10500 per month.
ix.
Rates of Commando Battalion for
Resolute Action (COBRA) Allowance granted to CRPF personnel deployed in Naxal hit areas will
be governed by the R&H Matrix. The rates will go up from ₹8400
- ₹16800 per month to ₹17300
– ₹25000 per month.
x.
Rates of Flying Allowance granted to flying branch and technical officers of Defence
Forces will be governed by the R&H Matrix. The rates will go up from ₹10500 - ₹15750 per month to ₹17300 – ₹25000 per month. It has been
extended mutatis mutandis to BSF Air Wing also.
xi.
Rates of Higher
Qualification Incentive for Defence Personnel have been increased from ₹9000 – ₹30000 (Grant) to ₹10000 – ₹30000 (Grant).
xii.
Aeronautical Allowance, presently paid to personnel of Indian Navy, has been extended to
Indian Coast Guard. The rate of this allowance has been increased from
₹300 per month to ₹450
per month.
xiii.
Rates of Test Pilot and Flight Test Engineer Allowance
will be governed by the
R&H Matrix. The
rates will go up from ₹1500 / ₹3000 per month to ₹4100 / ₹5300 per month.
xiv.
Rates of Territorial Army
Allowance have been increased from ₹175 - ₹450 per month to
₹1000 - ₹2000 per month.
xv.
Ceilings of Deputation
(Duty) Allowance for Defence Personnel have been increased from ₹2000
- ₹4500 per month
to ₹4500 - ₹9000
per month.
xvi.
Rates of Detachment
Allowance have been increased ₹165
- ₹780 per day
to ₹405 – ₹1170
per day.
xvii.
Rates of Para Jump
Instructor Allowance have been increased from ₹2700/3600
per month
to ₹6000 / 10500 per month.
xviii.
Special Incident /
Investigation / Security Allowance has
been rationalized. Rates for Special Protection Group (SPG) have been revised
to 55% and 27.5% of Basic Pay for operational and non – operational duties
respectively.
8. Recommendations
in respect of some important allowances paid to Indian Railways
i.
Rates of Additional Allowance have
been increased from ₹500
/ 1000 per month to ₹1125
/ 2250 per month. This has also been extended to Loco Pilot Goods and Senior
Passenger Guards also @₹750 per month.
ii.
In view of strenuous nature of the job, new Allowance namely Special Train Controller’s Allowance
@5000 per month
for Train Controllers of Railways has been introduced.
9. Recommendations
in respect of some important allowances paid to Nurses & Ministerial Staffs of Hospital
i.
Existing rate of Nursing Allowance
has been increased from ₹4800
per month to ₹7200
per month.
ii.
Rate of Operation Theatre Allowance
has been increased from ₹360
per month
to ₹540 per month.
iii.
Rates of Hospital Patient Care Allowance / Patient Care Allowance have been increased from ₹2070 - ₹2100 per month to ₹4100 – ₹5300 per month. 7th
CPC recommendations modified to the extent that it will be granted to
Ministerial staff also.
10. Recommendations
in respect of some important allowances paid to Pensioners
Rate of Fixed Medical Allowance (FMA)
for Pensioners has been increased from ₹500
per month to ₹1000
per month. This will benefit more than 5 lakh central government pensioners not
availing CGHS facilities.
i.
The rate of Constant
Attendance Allowance granted on 100% disablement has been increased from ₹4500 per month
to ₹6750 per month.
11. Allowances to Scientific Departments
i.
The recommendations of 7th CPC to
abolish Launch Campaign Allowance and Space Technology Allowance
has not been accepted. In order to incentivize the supporting employees in
Space and Atomic Energy sector, the rate of Launch Campaign and Space Technology Allowance has been increased
from ₹7500
per annum to ₹11250
per annum. Professional Update Allowance for
non-gazetted employees of Department of Atomic Energy will also continue to be
paid at the enhanced rate of ₹11250 per annum.
ii.
The 7th CPC had placed Antarctica
Allowance, paid to the Scientists and other members undertaking the
expedition to Antarctica under the Indian Antarctic programme, in the RH-Max
Cell of the R&H Matrix. The rates of the RH-Max Cell recommended by the 7th
CPC were less than the existing rates of Antarctica Allowance which is
currently paid on per day basis. Considering the specific nature of these
expeditions and to provide appropriate increase in rates, Government has
decided to keep Antarctica Allowance out of the R&H Matrix and the
allowance will continue to be paid on per day basis as per existing practice.
The Rates of Antarctica Allowance will go up from ₹1125
per day (Summers) and ₹1688
per day (Winters) to ₹1500
per day (Summers) and ₹2000
per day (Winters).
12. Allowances paid to D/o Posts
i.
The recommendations of 7th CPC to
abolish Cycle Allowance, granted mainly to
Postmen and trackmen in Railways, has not been accepted. Keeping in
view the specific requirement of this allowance for postmen in
Department of Posts and trackmen in Railways, the cycle allowance is retained
and the rates have been doubled from ₹90
per month to ₹180
per month. This will benefit more than 22,200 employees.
Conclusion
While increasing the
rate of allowances affecting the central government employees, especially the
Defence, CAPF and Coast Guard personnel, the staff of Railways, Postal
department and nursing staff, the total number of allowances have been
rationalized from 197 to 128. Thus, the Government has shown a great deal of
fiscal prudence and at the same time addressed the genuine concerns of the
employees and responded to some of the administrative exigencies necessitating
the modifications.
