Eighteen months after the 7th pay commission award hiked the allowance of Central Government Employees are likely to start receiving the revised payment from July.
The revised allowance also includes HRA. The hiked payment is likely to firm up private consumption growth which had tanked a little in the final quarter of last fiscal.
The 18 months delay in disbursal of the revised allowances has saved the exchequer RS 2,2oo crore a month, however according to the source the government is likely to compensate the delay with a higher HRA then recommended by the panel. The more generous HRA could be 27 percent of the basic pay in cities with population above five million, as opposed to the commission’s proposal of 24 percent.