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Wednesday, 28 June 2017
Cabinet approves recommendations of the 7th CPC on allowances
Government of India
Cabinet Committee on Economic Affairs (CCEA)
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 7thCPC 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 27thApril, 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
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
Modifications approved by the Cabinet
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.
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
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
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.
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.
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.
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.
in respect of some important allowances paid to all employees:
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.
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
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.
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.
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 Allowancegranted 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.
of Commando Battalion for Resolute Action (COBRA) Allowancegranted 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.
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
xi. Rates of Higher Qualification
Incentive for Defence Personnel have been increased from ₹9000 – ₹30000 (Grant) to ₹10000 – ₹30000 (Grant).
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.
xiv. Rates of Territorial Army Allowance have
been increased from ₹175 - ₹450 per month to ₹1000 - ₹2000 per
xv. Ceilings of Deputation (Duty)
Allowance for Defence Personnel have been increased from ₹2000 - ₹4500 per month to ₹4500 - ₹9000 per month.
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.
in respect of some important allowances paid to Indian Railways
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.
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.
in respect of some important allowances paid to
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
rate of Constant Attendance Allowance granted on 100%
disablement has been increased from ₹4500 per
month to ₹6750 per
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).
paid to D/o Posts
i.The recommendations of 7th CPC to abolishCycle 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.
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