Cabinet Approves Recommendations of 7th CPC on Allowances Report – Railway Services

Govt. has approved long delayed 7th CPC recommendations of allowances report in cabinet on 28.06.2017. Here are the highlights of allowances report (Railway Services)approved by Govt. Cabinet released by Press Information Bureau of India.

  • Government has decided not to abolish 12 of the 53 allowances which were recommended to be abolished by the 7th CPC
  • 3 of the 37 allowances recommended to be subsumed by the 7th CPC will continue as separate identities.
  • HRA will be paid @ 24% for X (population of 50 lakh & above), 16% for Y (5 to 50 lakh) and 8% for Z (below 5 lakh) category of cities. These rates will be revised upwards when DA crosses 25% and 50% respectively.
  • 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.
  • 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.
  • Existing rates of Special Allowance for Child Care for Women with Disabilities has been doubled from ₹1500 per month to ₹3000 per month.
  • Higher Qualification Incentive for Civilians has been increased from ₹2000 – ₹10000 (Grant) to ₹10000 – ₹30000 (Grant).
  • 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.
  • 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.
  • Existing rate of Nursing Allowance has been increased from ₹4800 per month to ₹7200 per month.
  • Rate of Operation Theatre Allowance has been increased from ₹360 per month to ₹540 per month.
  • 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.
  • 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.
  • The rate of Constant Attendance Allowance granted on 100% disablement has been increased from ₹4500 per month to ₹6750 per month.

Cabinet approves recommendations of the 7th CPC on allowances (Cabinet Committee on Economic Affairs (CCEA)28-June, 2017 20:24 IST)

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.

Highlights of Cabinet approval on Allowances

  • 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 CPCThis will benefit over one lakh employees belonging to specific categories in Railways, Posts, Defence and Scientific Departments.

  • 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.

  • 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.

Recommendations in respect of some important allowances paid to all employees:

  • 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.
  • Existing rates of Special Allowance for Child Care for Women with Disabilities has been doubled from ₹1500 per month to ₹3000 per month.
  • Higher Qualification Incentive for Civilians has been increased from ₹2000 – ₹10000 (Grant) to ₹10000 – ₹30000 (Grant).

Recommendations 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.
  • 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.

Recommendations in respect of some important allowances paid to Nurses & Ministerial Staffs of Hospital

  •  Existing rate of Nursing Allowance has been increased from ₹4800 per month to ₹7200 per month.
  • Rate of Operation Theatre Allowance has been increased from ₹360 per month to ₹540 per month.
  • 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.

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.
  • The rate of Constant Attendance Allowance granted on 100% disablement has been increased from ₹4500 per month to ₹6750 per month.

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 rationalised 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.

Source: pib.nic.in (Release ID :166967)



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