The latest buzz about the 7th Central Pay Commission (CPC) recommendations is that the NDA government is likely to pay higher allowances from January 2017 as proposed by the pay panel. The Modi government had referred to the hike in allowances to a select committee while accepting the hike in salary component in June last year.
The Sen Times, an online newspaper for bureaucrats, quoted finance ministry sources as saying that the hike will be applicable with retrospective effect from August 2016.
""Higher allowances will be paid with retrospective effect from August 2016 but the central government employees unions demanded for implementation of the allowances with retrospective effect from January 2016," The Sen Times said, quoting finmin sources.
The publication had said a few days that a decision on allowances was being kept in "abeyance" by the government in view of the situation arising out of demonetisation and the consequences thereof.
The CPC examined 196 allowances and gave its recommendations on abolishing or raising some of them while recommending others to be subsumed with other perks.
The recommendations of the 7th CPC cover 47 lakh Central government employees and 53 lakh pensioners, of which 14 lakh employees and 18 lakh pensioners are from the defence forces.
It had proposed 138.71 percent hike in HRA and 49.79 percent for other allowances while submitting its voluminous report last November.
The additional amount on account of hike in HRA and other allowances is about Rs 29,300 crore (Rs 17,200 crore + Rs 12,100 crore) during the current fiscal, as estimated by the 7th CPC.