DA Hiked For Central Govt Employees: Will The HRA Too Rise In July?

This Monsoon there seems to be raining of good news for the Central government employees. The de-freezing of the Dearness Allowance (DA) yesterday has unlocked more windfalls for the over 50 lakh strong Central workforce. A big hike is expected in the House Rent Allowance (HRA) payable to them.

The Windfall

As per the Department of Expenditure's order number 2/5/2017-E.II(B), the rates of HRA will be revised to 27 per cent, 18 per cent and 9 per cent for X, Y & Z level of cities, respectively, when the Dearness Allowance (DA) crosses 25 per cent.

since it's only yesterday, the Union Cabinet Committee on Economic Affairs (CCEA) has hiked the DA rate to 28 per cent from 17 per cent in 2020, and as the DA rate has exceeded the 25 per cent benchmark, as per DoE's own order, the HRA will rise to 27 per cent from present 24 per cent for X-level cities, 18 per cent from 16 per cent for Y-grade cities and 9 per cent from present 8 per cent for Z-cities.

Will Odisha Employees Gain?

Odisha has no X-level city. The State has three Y-grade cities - Bhubaneswar, Cuttack and Rourkela. All other cities in the State come under Z-level.

An employee drawing a monthly salary up to Rs 21,700 will not be going benefit from the rise in HRA following the hike in DA rate.

However, an employee drawing a monthly basic pay of Rs 25,500 will now get an HRA totalling Rs 6,885 from Rs 6120, a month earlier. The calculator shows a gain of Rs 765 for the employee.

Similarly, the employee whose monthly basic pay is Rs 35,400, then under new HRA norms, h/she will stand to gain Rs 1062. More details are below.

• If basic pay is Rs 29,200 per month, the gain comes at Rs 876.
• One having basic pay of Rs44,900, the increase will be Rs 1,347.
• If drawing a basic pay of Rs 56.100, the rise h/she will accrue is Rs 1,683.

For the employees in Z-level cities in Odisha, the details are listed below.

• Those who are drawing a monthly basic pay of up to Rs 25,500 are not going to avail of the HRA benefit.
• However, if your basic is 29,200 per month, then the gain accrued will be Rs 292 per month.
• Similarly, if you're drawing a basic pay of Rs 44,900 per month, then the rise in amount per month will be Rs 449.