It was decided that HRA will not be less than Rs 5400, Rs 3600 and Rs 1800 for X, Y and Z category of cities respectively.
7th Pay Commission HRA allowances: After Narendra Modi-led government announced a bonanza for Central government employees last month by approving recommendations of the 7th CPC with 34 modifications, the Finance Ministry has asked all central ministries to ensure revised rates of allowances as per the report are paid from the current month. This move will benefit 48 lakh employees (34 lakh civilian employees and 14 lakh defence personnel. All allowances are given effect from July 1, 2017. Sharing details, Arun Jaitley had said that Pay Commission had recommended reduction in the HRA rates to 24 per cent for X, 16 per cent for Y and 8 per cent for Z category of cities.
As the HRA at the reduced rates may not be sufficient for employees falling in lower pay bracket, it was decided that HRA will not be less than Rs 5400, Rs 3600 and Rs 1800 for X, Y and Z category of cities respectively. This floor rate has been calculated at 30 per cent, 20 per cent and 10 per cent of the minimum pay of Rs 18,000.
Here is the list of cities classified for HRA under X, Y and Z category:-
Cities falling under X (population of 50 lakh and above) category – Rs 5400
Hyderabad, Delhi, Ahmedabad, Bengaluru, Greater Mumbai, Pune, Chennai and Kolkata.
Cities falling under Y (population between 5 lakh-50 lakh) category – Rs 3600
Vijaywada, Warangal, Greater Visakhapatnam, Guntur, Nellore, Guwahati, Patna, Chandigarh, Durg-Bhilai Nagar, Raipur, Rajkot, Jamnagar, Bhavnagar, Vadodara, Surat, Faridabad, Gurgaon, Srinagar, Jammu, Jamshedpur, Dhanbad, Ranchi, Bokaro Steel City, Belgaum, Hubli-Dharwad, Mangalore, Mysore, Gulbarga, Kozhikode, Kochi, Thiruvanthapuram, Thrissur, Malappuram, Kannur, Kollam, Gwalior, Indore, Bhopal, Jabalpur, Ujjain, Amravati, Nagpur, Aurangabad, Nashik, Bhiwandi, Solapur, Kolhapur, Vasai-Virar Cty, Malegaon, Nanded-Waghala, Sangli, Cuttack, Bhubaneswar, Raurkela, Amritsar, Jalandhar, Ludhiana, Puducherry, Bikaner, Jaipur, Jodhpur, Kota, Ajmer, Salem, Tirupur, Coimbatore, Tiruchirappalli, Madurai, Erode, Dehradun, Moradabad, Meerut, Ghaziabad, Aligarh, Agra, Bareilly, Lucknow, Kanpur, Allahabad, Gorakhpur, Varanasi, Saharanpur, Noida, Firozabad, Jhansi, Asansol, Siliguri, Durgapur.
Cities classified under Z (population below 5 lakh) category – Rs 1800
The remaining cities and towns in various states or Union Territories (which are not covered under X or Y category) will be paid at 10%.
The resolution conveying the central government’s decision on recommendations of the CPC on Allowances was published in Gazette of India.