In July a year ago, the government formed a committee under Finance Secretary Ashok Lavasa to review the pay commission recommendations on allowances. Centre in a statement said, "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". According to the latest developments and recommendations, it is implemented that the current PM Mr. Narrinder Modi approved the decision for the CPC which surely reflects that the seventh Pay Commission proposals are concerned.
As the HRA at the reduced rates may not be sufficient for employees falling in lower pay bracket, it has been chose to raise it, the minister said.
An official release said that the modifications were based on suggestions made by the CoA in its Report submitted to Finance Minister on April 27, 2017 and the Empowered Committee of Secretaries set up to screen the recommendations of 7th CPC.
Effectively, HRA from 1 July will be a minimum of Rs. 5,400, Rs. 3,600 and Rs 1,800 for employees working in X/Y/Z category cities, respectively.
Sharing details, Jaitley said the Pay Commission had recommended reduction in the HRA rates to 24 per cent for X, 16 per cent for Y and 8 per cent for Z category of cities.
The HRA rates will be revised when Dearness Allowance (DA) crosses 25 per cent and 50 per cent respectively. The government chose to revise rates when DA crosses 25 per cent and 50 per cent, respectively. The revised HRA will benefit more than 7.5 lakh employees, the government's principal spokesperson Frank Noronha said on Twitter. The officers will now get monthly allowance of Rs 42500, which was earlier Rs 21000.
Siachen Allowance: The government has chose to enhance the rates of Siachen Allowance which will now go up from the existing rate from Rs14,000 to Rs 30,000 per month for Jawans & JCOs (Level 8 and below) and from Rs 21,000 to Rs 42,500 per month for Officers (Level 9 and above).
As for 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.
Existing rates of Special Allowance for Child Care for Women with Disabilities has been doubled from Rs 1,500 to Rs 3,000 per month.