Thursday, August 18, 2016

Non Payment of HRA as per the Rates Recommended by 7th Pay Commission – A Great Disappointment

Non Payment of HRA as per the Rates Recommended by 7th Pay Commission – A Great Disappointment

The Seventh Pay Commission submitted its report to the Central Government in November 2015. Among the most eagerly-anticipated topics was the recommendations regarding the House Rent Allowances. Typically, an employee spends more than a third of his/her salary on house rent. Keeping in mind this huge and unavoidable expense for Central Government employees living in major cities, the Sixth Pay Commission had recommended that 10, 20 and 30 percent of the Basic Pay be given as HRA.

The various Central Government employee unions and Federations requested the Seventh Pay Commission to recommend to the government that the percentage of HRA be increased. To everybody’s surprise, the Seventh Pay Commission recommended that the government reduce the HRA to 8, 16, and 24 percent. Although many reasons were given for this recommendation, the employees were hugely disappointed. Since the recommendations will be applied for the next ten years, there was a strong demand for the previous HRA levels to continue. As a consequence, all the Central Govt Employee’s Federations began to put pressure on the Central Government to increase the percentage of HRA. This also became one of their most important demands.

The Central Government, meanwhile, bought time for itself by announcing the formation of an Empowered Committee to look into the recommendations of the Seventh Pay Commission. There is no news about the Empowered Committee report, as of this date.

On June 29, the central cabinet gave its approval to the recommendations of the Seventh Pay Commission. It was announced that a committee would be constituted under the leadership of the Finance Secretary, to look into the issue of various allowances, including the HRA. The committee would be advised to present its report in four months. Until then, HRA will be issued as per the pre-revised pay and rates.

During the negotiations that were held to prevent a nationwide indefinite strike(July 11), this issue was discussed in detail. The government agreed to constitute a high-level committee. It was said that the government had “indirectly accepted” the recommendations made by the high-level committee regarding the HRA.

On July 25, the government confirmed the implementation of the Seventh Pay Commission by publishing it in the official Notification & Gazette. There was no change regarding the HRA.

The employees meanwhile recollect, with surprise, the four months’ time that was given to the special committee for discussing the HRA issue. The announcement that the Sixth Pay Commission recommendations will be followed until the committee announces its decision, is considered to be the biggest disappointment of them all.

HRA plays the most important role in salary increment. The employees feel that as per the percentages recommended by the Seventh Pay Commission, the HRA should be given from this month’s salary onwards. Some feel that the arrears in the HRA could have been paid later.

Why is the government hesitating to implement it?

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