Pay Allowances & Facilities to Central Government Employees in India based on 6th CPC

Government of India, considered pay related proposals for its employees submitted by the 6^th Pay Commission and notified its decisions on Aug 29, 2008. Date of implementation was decided to be January 1, 2006 but admissibility of Children Education Allowance (CEA), revised House Rent Allowance (HRA) and Conveyance Allowance was determined to take place from September 1, 2008. Major changes suggested by 6^th Pay Commission and accepted by Gov. of India are listed below.

• Reimbursements of allowances would be raised automatically by 25 per cent once dearness allowance becomes 50 per cent of the basic salary,
• Revised pay scales/bands were made effective from January 1, 2006 but arrears were payable in 2 splits i.e. 40% in 2008-09 and 60% in 2009-2010

Allowances and Facilities:

A. Allowances

Dearness allowances (DA): Government of India accepted 6th Pay Commission’s recommendation for the continued use of AICPI (IW) as index used for calculating DA and sanctioning twice a year as on 1st January and 1st July payable with the salary of March and September, respectively.

City Compensatory Allowance (CCA): abolished by 6^th CPC

Other allowances:

Employees having grade pay of Rs. 5400 and above will get a Project Allowance of Rs.1500 P.M. and others drawing less than 5400 grade pay will be eligible for Rs.1000 P.M. Project allowance will be automatically revised by 25% increase whenever the DA goes up by 50%. Special Compensatory Allowance for Gandhinagar and Special Compensatory (Border Area) Allowance was abolished whereas all Central Government employees on their posting on transfer to any North East Region were allowed to draw SCA at existing recommended rate. The Special (Duty) Allowance as well as other concessions allowed to the Government employees posted in Ladakh. Island Special (Duty) allowance was made available to all Central Government employees on their posting on transfer to any place in these Islands without insisting on an all India transfer liability. Hard Area Allowance was allowed to the employees posted in the Nicobar group of Islands separately along with Island Special (Duty) Allowance and broadened to the Lakshadweep group of islands.

Travel  and Daily Allowance:

Travel was allowed by any means of public transport for road travel between places connected by rail, with a condition that total fare does not exceed the train fare by the entitled class. Employees entitled by AC II Tier and above in train may travel by AC bus and those who are entitled to travel by First Class/AC III Tier/AC Chair Car/Sleeper Class in train are entitled to travel by Deluxe/Ordinary bus. Govt. of India prohibited private use of mileage points earned by Government employees on tickets purchased for official travel and made it mandatory to use such mileage points by the concerned department for other official travel by their respective officers.

The recommended rates of daily allowances are illustrated in above Table.The rates of all the components of Daily Allowance shall automatically increase by 25% whenever the Dearness Allowance payable on the revised pay bands goes up by 50%. In case of stay or journey on Government ships, boats etc.or journey to remote places on foot/mules etc. for scientific/data collection purposes in organisations like FSI, Survey of India, GSI etc., daily allowance will be paid at rate equivalent to that provided for reimbursement of food bill. However, in this case the amount will be sanctioned irrespective of the actual expenditure incurred on this account with the approval of the Head of Department/Controlling Officer. For journey on foot, an allowance of Rs.5 per kilometer traveled on foot shall be payable additionally. This rate will also be increased by 25% whenever DA payable on revised pay scales goes up by 50%.

Leave Travel Concession: What could be termed as the most remarkable recommendation made by the Sixth Pay Commission was abolition of distiction for entitlement between LTC and TA tours. Other commendable recommendation was the encashment of Earned Leave upto 10 days along with LTC to the extent of total of 60 days in entire service period, and non-deduction of these Earned Leaves from the maximum amount of Earned Leave (300 days) encashable at the time of retirement.The bad thing was making leave encashment (on account of LTC) taxable. Condition requiring travel to be performed in vehicles operated by the Government or any Corporation in the public sector run by the Central or State Government or a local body was , however, maintained as done by earlier commissions. 

7. Transport Allowance:

Sixth Pay Commission not only increased the the existing amount of transport allowance but also eliminated the condition that  prohibited earlier grant of transport allowance to the employees who were provided with official accommodation within one Kilometer of the office is removed.  Physically disabled employees shall continue to draw this allowance at double the normal rates even in the revised scheme subject to condition that transport allowance in the for physically disabled employees shall, in no case, be less than Rs.1000 per month plus the applicable rate of dearness allowance. Employees (in pay band PB-4) entitled to the use of official car for travel between residence and office have been provided with the option to draw transport allowance at a higher rate of Rs.7000 p.m. plus dearness allowance  if they use of official car for travel between residence and office. The Commission recommends following rates for Transport Allowance :

House Rent Allowance:

• the Commission recommended merger of C Class Cities (having population of 50,000 to 5 lakh) with `Unclassified Towns' (having population of less than 50,000).
• The existing population criterion for classifying towns and cities for purposes of HRA is being retained but population in the urban agglomeration should be taken into account for classifying a city for purposes of HRA.
• HRA in A-1 cities be paid at the rate of 30% of the total of revised pay in the running pay band and grade pay thereon.
• Erstwhile A, B-1 and B-2 categories are being merged.

• The following rates of House Rent Allowance:

Non-Practicing Allowance (NPA)

The 6th Pay Commissions recommends that Doctors should continue to be paid NPA at the existing rate of 25% of the aggregate of the band pay and grade pay subject to the condition that the Basic Pay + NPA does not exceed Rs.85,000.

Transfer Traveling Allowance (TTA):

The Commission recommends that transportation of personal effects by road at the rates prescribed for `other places' should be allowed in respect of places connected by train as well without subjecting it to the extant restriction that these can not exceed 1.25 times of the eligible train fare. The revised entitlements of transport while on transfer shall, therefore, be as follows :-

Calculations for revised pay and pay arrears

1. Government has amended the rate of increment suggested by the 6th pay commission (2.5% to 3%)

2. Fitment based on multiplication factor of 1.86 instead of 1.74

Pay Fixation:

The basic pay drawn as on 1-1-2006 on the existing 5th CPC pay scales will be multiplied by a factor of 1.86 and then rounded off to next multiple of 10. This will be the pay in the revised running pay band. Grade pay as approved by the Government, corresponding to the pre-revised pay scale, will then be added to the pay in the revised band. The total of pay in the pay band and grade pay will be revised basic pay as on 1-1-2006.

To help pay fixation in new revised pay bands, instructions to fix pay has been issued by the Govt. and tables for each pay band has been released.

Fixation of pension/Family Pension:

I have recieved several requests from viewers for calculation of Pension/Family Pension . Viewers may understand that this is time taking job. Hence, employees covered under pension scheme including both who retired before 1.1.2006 and on or after this date may have a idea about fixation of pension/family pension clicking pension benefits.

updates:

Travel entitlement and allowances as per Govt. OM dated 23-9-2008

Gratuity limit increased to Rs 10 lakh. Employees covered under pension scheme including both who retired before 1.1.2006 and on or after this date.

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