7th Pay Commission: Modi’s New Year Gift for over 11 Lakh Government Employees, Salaries Might Increase

The Central Government employees can expect good news before New Year. According to the latest reports, the Narendra Modi Government may announce a hike in the House Rent Allowance (HRA) in early January 2022.

According to last week’s media reports, the Finance Ministry has already initiated the planning on increasing the HRA of the central government employees, a move that is expected to benefit more than 11.56 lakhs of employees, who are working with Indian Railways.

This may be recalled that the Indian railway Technical Supervisors Association & National Federation of Railwaymen have been demanding to implement the HRA from New Year, January 1, 2022, based on the 7^th Pay Commission’s Recommendation. After increasing the House Rent Allowance (HRA), there will be a bumper increase in the salary of the central government employees.

House Rent Allowance Calculation Based on 7^th Pay Commission

• HRA is paid @24%, 16% & 8% for X, Y and Z cities respectively.HRA is not to be less than Rs 5400, Rs 3600 & Rs 1800 for the X, Y and Z cities, calculated @30% & 10% of a minimum pay of Rs 18,000.

• The 7^Th CPC also recommended the revision of HRA, when DA reaches 50% and 100% government decided to revise the rates when DA crosses 25% & 50% respectively.

31% Increase in DA

In July the government had increased DA by 11% from 17% to 28% after which, once again on 3rd October, a 3% increase in DA was done, because of which DA has increased to 31%. 

The DA of the Central Government employees has been increased 2 times this year. If the basic salary of an employee is Rs 18,000. He is currently getting Rs 5,040 as a DA. This amount is 28% of the basic salary. After DA 31%, the employees will get Rs 5,580 as DA. With the increase in basic pay, the total amount of DA will also increase. On an annual basis, the salary will increase by Rs 6480.