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Overview of 7th CPC Allowances for Central Government Employees

Author:

Dr. Singh leads a retired life after serving as agricultural researcher for 32 years. Writing about agriculture is his hobby.

Central government employees are provided monetary benefits over and above their basic salary to meet expenditures of particular nature incurred in discharging their duties. These benefits are known as pay allowances. Some of the allowances are fully taxable, and some are partially taxable:

Fully Taxable Allowances

  • Entertainment
  • Dearness
  • Overtime
  • Cash
  • Servant/Helper
  • Tiffin

Partially Taxable Allowances

  • House Rent
  • Leave Travel
  • Conveyance
  • Medical Bills Reimbursement
  • Children Education
  • Hostel

The 7th CPC recommended that 52 allowances be abolished and 32 be subsumed in other allowances, out of a total of 196 allowances.The Committee set up to analyse the recommendations suggested certain modifications in the 7th CPC recommendations and submitted its report in April 2017.

The Report of the Committee was further examined in the Department of Expenditure and also placed before the Empowered Committee of Secretaries and submitted for approval of the cabinet. A Gazette notification was issued to implement the report for grant of these allowances with effect from 1.7.2017.

House Rent Allowance (HRA)

The House Rent Allowance (HRA) is granted to Central Government Employees for payment made by them towards renting a house where they can reside with their family.

The following decisions are applicable for disbursement of the House Rent Allowance.

  • Employees will be entitled to different rates of HRA based on their place of posting. The Rates of the HRA are 24, 16 and 8 percent for 'X', 'Y' and 'Z' categories of cities, respectively.
  • The Minimum rates of HRA will be Rs. 5400/-, 3600/- and 1800/- at X, Y & Z class cities, respectively.
  • The Non-Practicing Allowance (NPA), Military Service Pay (MSP) and Special pay shall not be included in the basic pay for HRA calculation.
  • Faridabad, Ghaziabad and Gurgaon are on par with Delhi, Jalandhar Cantt, Shillong, Goa and Port Blair with Jalandhar, and Panchkula, S.A.S. Nagar (Mohali) with Chandigarh for HRA calculation.
  • Additional HRA shall be granted to the civilian employees posted to States of North Eastern Region, Andaman & Nicobar Islands, Lakshadweep Islands and Ladakh, who leave their families behind at their old duty station at revised rates.
  • Rates will be revised as follows with changes in dearness allowances (DA).

Classification of Cities/Towns

HRA as a percentage of Basic Pay when DA crosses 25%

HRA as a percentage of Basic Pay when DA crosses 50%

X

27%

30%

Y

18%

20%

Z

9%

10%

Children Education Allowance (CEA)

Central Government Employees are paid a Children Education Allowance (CEA) to take care of schooling and hostel requirements of their children up to class XII. An allowance of Rs. 2250/- per month has been allowed to be reimbursed as CEA and Rs. 6750/- as hostel subsidy. Differently-abled children are entitled the double rate of CEA. CEA is indexed to the Dearness Allowance, and whenever DA increases by 50%, CEA shall increase by 25%.

As per the recommendation of the 7th CPC, reimbursement should be made once a year, after completion of the financial year. A certificate from the Head of the Institution should be sufficient for reimbursement. In a bid to simplify the rules, the 7th CPC recommended submission of a similar certificate from the Head of the Institution mentioning the amount of expenditure for reimbursement.

Transport Allowance

The Transport Allowance is paid to Central Government Employees to meet the expenditure incurred on fuel costs for attending official duties. Physically disabled employees are to be paid at double the normal rates (subject to a minimum of Rs. 2250/- p.m.). However, Transport Allowance is not admissible for a calendar month wholly covered by leave or on tour or during the period of deputation abroad. An employee shall not be paid Transport Allowance if one is under suspension.

The following rates of Transport Allowance are admissible to employees based on their place of posting:

Employees drawing pay in Pay Level

Employees posted in the Cities as per Annexure

Employees posted at all other places

9 and above

Rs. 7200 +DA thereon

Rs. 3600 +DA thereon

3 to 8

Rs. 3600 +DA thereon

Rs. 1800 +DA thereon

1* and 2*

Rs. 1350 + DA thereon

Rs. 900 +DA thereon

As per Order No. 21/5/2017-E.II(B)*, dated 2-8-2017, employees drawing pay of Rs. 24200/- and above in Pay Level 1 & 2 of the Pay Matrix shall be eligible for Trans. Allowance @ Rs. 3600/- plus DA thereon in the cities mentioned in the Annexure and @ Rs. 1800/- plus DA thereon at all other places.

Travelling Allowance

A Travelling Allowances is permitted to Central Government Employees for travels undertaken on official duties, travels on transfer posting, on retirement and when using leave travel concession. Entitlement of travel class depends on the pay level in which employee is placed.

Employees placed in pay level 17 and above are entitled to first class, pay level 14 to 16 for business/club class and pay level 13 and below for economy class, respectively, while on tour to international destinations.

For journeys by sea, employees placed in pay level 9 and above are entitled to highest/deluxe class, 6 to 8 pay level to lower class/first or 'A' cabin, 4 and 5 to second or third class/second or 'B' cabin and 3 and below pay level for lowest/bunk class while traveling to places other than Andaman/Nicobar Islands and between mainland and A&N Islands, respectively.

Government officials shall be allowed to travel by Premium Trains/premium Tatkal Trains/Suvjdha Trains. Journeys in case of places not connected by rail, travel by AC bus (for all those entitled to travel by AC ll Tier and above by train) and by Deluxe/ordinary bus (for others) is allowed. If employees are travelling in places connected by rail, travel by any means of public transport is allowed provided fare does not exceed the train fare by the entitled class.

The reimbursement will be allowed to Premium Tatkal Charges for booking of tickets and the reimbursement of Dynamic/Flexi{are in Shatabdi/Rajdhani/Duronto Trains while on official tour/ training. Tatkal Seva Charges will continue to be reimbursed.

Entitlement for journeys on tour or trainings in trains or air flights based on pay levels is given below.

Pay Level in the Pay Matrix

Entitlement

Entitlement in Rajdhani & premium trains

14 and above

Business/Club class by air or AC-I by train

Executive/Ac 1st Class (ln case of Premium/Premiurm Tatkal/Suvidha/Shatabdi/Rajdhani Trains as per available highest class

12 and 13

Economy class by air or AC-I by train

Executive/Ac 1st Class (ln case of Premium/Premiurm Tatkal/Suvidha/Shatabdi/Rajdhani Trains as per available highest class

6 to 11

Economy class by air or ACII by train

AC 2nd Class/Chair Car (In Shatabdi Trarns)

5 and below

First Class/AC-III/AC Chair car by train

AC 3rd Class/Chair Car

Mileage Allowance for Journeys by Road

Employees drawing pay in pay level 14 & above are entitled for reimbursement of actual fare by any bus/taxi including AC whereas employees in pay level between 6-13 are entitled for AC bus but not for AC taxi. The actual fare can be reimbursed for travelling by any bus other than AC bus for employees placed in pay level 4 and 5. Likewise, employees in pay level 3 or below may undertake journeys by ordinary bus only. However, employees belonging to any category may travel by auto rickshaw or their own vehicle at prescribed rates.

In places where no specific rates have been prescribed reimbursement of Rs. 24/- per km will be allowed for journeys performed in own car/taxi and Rs. 12/- per km for journeys performed by auto rickshaw or own scooter etc. This rate will increase by 25% whenever DA increases by 50 percent.

Daily Allowances

This involves three components: namely, reimbursement of hotel charges, travelling charges and food bills. For levels 8 and below, the claim subject to the ceiling may be paid without production of vouchers. Self-certified claims, clearly indicating the period of stay, name of dwelling, period of travel, vehicle number etc.,may be reimbursed. Additionally, the ceiling for reimbursement of hotel charges would be Rs 1000/- per day upon production of relevant vouchers. Limit for reimbursement of hotel charges will further increase by 25 percent whenever DA increases by 50 percent.

A lump sum amount payment shall be made for food charges as per the rates given in the table below, depending on the length of absence from the headquarter. If absence is longer than 12 hours, 100% of lump sum amount will be paid. In case of 6-12 hours, 70% of the lump sum will be paid, and 30% amount for less thn 6 hours absence. No vouchers will be required for lump sum amount paid on account of food bills.

For journeys on foot, daily allowance will be paid at the rate equal to amount payable for food bills.

This rate will further increase by 25% whenever DA increases by 50%.

Daily allowances on tour are shown below.

Transport of personal effects

Pay LevelHotel Accommodation (Rs.)Taxi ChargesFood Bills

14 and above

Up to 7,500/- per day

AC taxi travel within city

Up to 1200/- per day

12 and 13

Up to 4,500/- per day

AC taxi upto 50 km/day within city

1000/- per day

9 to 11

Up to 2,250/- per day

Non-AC taxi, Rs. 338/- per day

900/- per day

6 to 8

Up to 750/- per day

Non-AC taxi, 225/- per day

Non-AC taxi, 225/- per day

5 and below

Up to 450/- per day

Non-AC taxi, 113/- per day

500/- per day

Transfer TA (TTA)

Rules applicable for travel entitlements as prescribed for tour, except for international travel, will be applicable in case of journeys on transfer. Other conditions are as follows.

  • The Composite Transfer Grant (CTG): 80% of the last month's basic pay when transferred to a place located at a distance of or more than 20 kms from existing place of posting.
  • In case of transfer to and from the Island territories of Andaman, Nicobar & Lakshadweep: CTG@100% of last month's basic pay (excluding NPA and MSP)
  • Transfer to stations (less than 20 kms from the old station/transfer within the same city): one third of the composite transfer grant will be admissible, if a change of residence takes place.
  • ln cases where the transfer of husband and wife takes place within six months, but after 60 days of the transfer of the spouse: 50 percent of the transfer grant on transfer shall be allowed to the spouse transferred later.
  • In case both the transfers are ordered within 60 days: No transfer grant shall be admissible to the spouse transferred later.

Transportation of Personal Effects

Pay LevelBy Train/SteamerBy Road

12 and above

6000 kg/4 wheeler wagon/1 double container

Rs. 50/- km

6 to 11

6000 kg/4 wheeler wagon/1 single container

Rs. 50/- km

5

3000 kg

Rs. 25/- km

4 and below

1500 kg

Rs. 15/km

TA Entitlement of Retiring Employees

Travel entitlements as prescribed for tour/transfer, except for international travel, will be applicable in case of retiring employees.Other conditions are as follows.

  • Composite Transfer Grant (CTG): 80% of the last month's basic pay for employees, who on retirement , settled down at places other than last station(s) of their duty located at a distance of more than 20 km.
  • In case of settlement to and from the Island territories of Andaman, Nicobar & Lakshadweep: CTG @100% of last month's basic pay (excluding NPA and MSP)
  • The transfer incidentals and road mileage for journeys are already subsumed in the composite transfer grant and will not be separately admissible.
  • In the case of retiring employees who, on retirement, settle at the last station of duty itself or within a distance of less than 20 kms: one third of the CTG if change of residence is actually involved.
  • Conditions for transportation of personal effects and conveyance will remain same as for transfer TA.

Leave Travel Concession

  • Presently, either two hometown visits or one home town and one All India visit are allowed in a block of four years.
  • For the first two 4-year blocks, three hometown visits and one “All India” visit are permissible.

7th CPC recommended splitting of hometown LTC for the employees posted in North East, Ladakh and Island territories of Andaman, Nicobar and Lakshadweep and extending grant of one additional free railway warrant to all personnel of CAPFs and the Indian Coast Guard mutatis mutandis. However, government did not allow grant of free warrant to Indian Navy Personnel since they are not deployed on field duty. Travel entitlement for availing LTC are same for train and air travels as on tour.

This article is accurate and true to the best of the author’s knowledge. Content is for informational or entertainment purposes only and does not substitute for personal counsel or professional advice in business, financial, legal, or technical matters.

Questions & Answers

Question: Will an employee be entitled to transport allowances if an employee has availed leave for the full month?

Answer: No, he will not be allowed to draw transport allowance if he has been on leave for entire month.