Cabinet Committee on Economic Affairs (CCEA)28-June, 2017 20:24 IST
Cabinet approves
recommendations of the 7th CPC on allowances
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 – ₹1170per
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.
SS/VBA/AK
(Release ID :166967)
As Per Press Information Bureau
