After much debate and protest by government employees on some of recommendations made by the Seventh Pay Commission on allowances, the government had formed a committee to review the same.
Government employees have been waiting to hear from the Narendra Modi government on allowances since the cabinet cleared the recommendations of the Seventh Pay Commission in June last year.
The Committee on Allowances, headed by Finance Secretary Ashok Lavasa, is expected to present its review report to Finance Minister Arun Jaitley today.
After much debate and protest by employees on some of recommendations made by the Seventh Pay Commission on allowances, the government had formed a committee to review the same.
The pay commission had recommended reducing the house rent allowance (HRA) to 24 per cent of basic pay as against the 30 per cent of basic pay employees were drawing under the Sixth Pay Commission.
According to some reports, the Committee on Allowances has recommended the current HRA slab, which is 30 per cent of basic pay, for metros. An announcement on the same is expected soon.
HERE ARE THE DEVELOPMENTS SO FAR:
Allowances form a significant chunk of government employees’ salary, and therefore when the pay commission recommended slashing some while merging others, protests erupted.
The Seventh Pay Commission recommended abolishing 53 of the current 196 allowances meant for employees while merging a few others.
The pay commission’s recommendation of a 14.27 per cent hike in basic pay is the lowest in 70 years. A further reduction in allowances meant earning the ire of nearly 50 lakh Central government employees.
The government constituted a committee under Finance Secretary Ashok Lavasa to review the pay commission’s recommendations on allowances.
The Committee on Allowances was initially given a time of four months to submit its report to the Finance Minister. In October last year, Ashok Lavasa was quoted by some media outlets as saying he was ready with the report.
However, the committee was later given an extension till February 22, 2017 to submit its report. The increase in allowances is expected to fall within the pay commission’s estimate of nearly Rs 29,300 crore in the first year.
According to some reports, the government is likely to give its nod to the revised allowances once the Assembly elections in five states are over. The revised allowances are expected to be effective from April 1, which marks the beginning of the new financial year.