New Delhi. The 8th Pay Commission remains one of the biggest expectations for central employees. With the increase in salary, the discussion regarding House Rent Allowance (HRA) has also intensified. If the basic pay increases in the new pay structure, it can have a direct impact on HRA, because HRA is calculated on the basis of basic pay.
At present, the recommendations of the 8th Pay Commission have not been implemented, hence all the figures coming out regarding HRA are possible estimates. The final change will be decided only after the approval of the government.
Understand the complete mathematics of HRA increase
HRA does not increase directly with the fitment factor, rather the basic salary changes as the fitment factor increases. After this, the amount of HRA is decided on the basis of the same new basic pay. In the current system, central employees get HRA according to the category of cities:
X Category City: 30% of basic pay
Y Category City: 20% of basic pay
Z Category City: 10% of basic pay
If the same rates continue in future and the basic pay increases, then the HRA in the employees’ account may also increase.
How much can be the benefit if 2.0 fitment factor is implemented?
In some approximate calculations, the probable salary and HRA have been calculated considering 2.0 fitment factor as the basis.
Level-4 Employees:Estimated Basic Pay: ₹51,000 per month
HRA in City X (30%): ₹15,300
HRA in city Y (20%): ₹10,200
HRA in Z city (10%): ₹5,100
These figures are based on approximate calculations only.
How many people have expectations from the 8th Pay Commission?
There is a possibility of change in the salary and pension of about 55 lakh central employees and 69 lakh pensioners after the implementation of the 8th Pay Commission. Various demands have been made by employee organizations regarding fitment factor. Some organizations are demanding higher fitment factor, which can lead to a big difference in basic pay and allowances.
Employees benefit from increasing HRA?
If there is an increase in HRA, then the maximum benefit can be given to those employees who live in rented houses in big cities. With the increase in basic salary, the allowance received every month can increase, the total salary can increase, and there can be relief from rising rental expenses.
Still waiting for the government’s decision
At present, the process regarding the 8th Pay Commission is going on and many issues are under discussion. How much HRA will increase, how much will be the fitment factor and what allowances will change, this will be decided only after the final recommendations. But if there are changes as per the estimated calculations, then the increase in HRA could prove to be a big relief for the central employees.
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