7th CPC HRA hike for Central Government employees and CPSE or PSU employees (3rd PRC) from 1st Jan 2021

7th CPC HRA hike

HRA will be hiked for 7th CPC Central Govt. employees and Armed Forces personnel, as DA crossed 25%, from 1st Jan 2021:

Since 1st January 2021, the calculated Dearness Allowance is 28%. As per 7th CPC, there is a condition that HRA will be revised if DA crosses 25%. So, accordingly the HRA will be increased to 27 % / 18 % / 9 % from presently 24 % / 16 % / 8 %, based on the population of city. But, this increase will not be implemented now, as the DA/DR is freezed till 30.06.2021.

This new HRA will be applied from 1st July 2021 in addition to the revised DA. So, where DA will be increased in the range of 30-35%, HRA will also be increased to 27%, a hike of 3%, for metro cities. While the losses in salary, suffered for 18 months from Jan’20 to Jun’21 due to the freezed DA/DR order, can’t be compensated in any manner, still we can get consoled by the dual increments in DA/DR as well as HRA.

Official Order of Implementation of 7th CPC for grant of House Rent Allowance (HRA) to Central Govt. employees: doe.gov.in

The Department of Expenditure (DoE) under the Ministry of Finance has issued the HRA order dated 7th July 2017, for the 7th CPC Central Govt. employees.

Official Order of Implementation of 7th CPC for grant of House Rent Allowance (HRA) to Armed Forces Personnel :

The department of Defence (DoD) of Govt. of India has issued the HRA order dated 11th October 2017, for the 7th CPC Armed Forces Personnel.

HRA will be hiked for 3rd PRC CPSE or PSU employees, as DA may cross 25%, from 1st july 2021:

Since 1st January 2021, the calculated Dearness Allowance is 23.68 %, but it may certainly cross 25 % from 1st July 2021. As per 3rd PRC, there is a condition that HRA will be revised if DA crosses 25%. So, accordingly the HRA will be increased to 27 % / 18 % / 9 % from presently 24 % / 16 % / 8 %, based on the population of city. But, this increase will not be implemented before, as the DA/DR is freezed till 30.06.2021.

This new HRA will be applied from 1st July 2021 in addition to the revised DA. So, where DA will be increased in the range of 25-30%, HRA will also be increased to 27%, a hike of 3%, for metro cities. While the losses in salary, suffered for 9 months from Oct’20 to Jun’21 due to the freezed DA/DR order, can’t be compensated in any manner, still we can get consoled by the dual increments in DA/DR as well as HRA

What is HRA, House Rent Allowance (HRA) for employees?

Many employees who work in Central Govt. job, State Govt. job, Public sector units (PSUs) or a private company, they have two options of having residence. Either they will reside in their own home / on-rent or they will reside in the Govt.’s provided or Company’s provided house.

So, if one resides in the Govt.’s provided or Company’s provided house, they will not get any house rent allowance (HRA) in the salary. But, for those employees, who reside in their own home or on rent, they will be given house rent allowance (HRA) in the salary.

HRA, House Rent Allowance (HRA) for 6th CPC Central Govt. employees & Armed forces personnel and for 2nd PRC PSUs or CPSEs employees:

In the 6th CPC and 2nd PRC, the HRA slabs were divided among 3 categories based on the population of city.

1. HRA for 6th CPC and 2nd PRC employees was paid @ 30%, for city X (population of 50 lakh & above),
2. HRA for 6th CPC and 2nd PRC employees was paid @ 20%, for city Y (population of 5 to 50 lakh),
3. HRA for 6th CPC and 2nd PRC employees was paid @ 10%, for city Z (population of below 5 lakh)

HRA, House Rent Allowance for 7th CPC Central Govt. employees & Armed forces personnel and for 3rd PRC PSUs or CPSEs employees, when DA is below 25%:

In the 7th CPC and 3rd PRC, the HRA slabs were also divided among 3 categories based on the population of city, but with reduced rate of HRA.

1. HRA for 7th CPC and 3rd PRC employees is paid @ 24 %, for city X (population of 50 lakh & above),
2. HRA for 7th CPC and 3rd PRC employees is paid @ 16 %, for city Y (population of 5 to 50 lakh),
3. HRA for 7th CPC and 3rd PRC employees is paid @ 8 %, for city Z (population of below 5 lakh)

But, keeping in view the current inflation trends, the Government had decided that these rates will be revised upwards when DA crosses 25% and 50% respectively.

HRA, House Rent Allowance for 7th CPC Central Govt. employees & Armed forces personnel and for 3rd PRC PSUs or CPSEs employees, when DA crosses 25%:

In the 7th CPC and 3rd PRC implementation, the HRA slabs were divided among 3 categories based on the population of city. It was decided that due to inflation, the rate of HRA will be revised when the Dearness Allowance (DA) will cross 25%.

1. HRA for 7th CPC and 3rd PRC employees will be paid @ 27 %, for city X (population of 50 lakh & above), if DA crosses 25%.
2. HRA for 7th CPC and 3rd PRC employees will be paid @ 18 %, for city Y (population of 5 to 50 lakh), if DA crosses 25%.
3. HRA for 7th CPC and 3rd PRC employees will be paid @ 9 %, for city Z (population of below 5 lakh), if DA crosses 25%.

HRA, House Rent Allowance (HRA) for 7th CPC Central Govt. employees & Armed forces personnel and for 3rd PRC PSUs or CPSEs employees, when DA crosses 50%:

In the 7th CPC and 3rd PRC implementation, the HRA slabs were divided among 3 categories based on the population of city. It was decided that due to inflation, the rate of HRA will be revised when the Dearness Allowance (DA) will cross 50%.

1. HRA for 7th CPC and 3rd PRC employees will be paid @30%, for city X (population of 50 lakh & above), if DA crosses 50%.
2. HRA for 7th CPC and 3rd PRC employees will be paid @ 20 %, for city Y (population of 5 to 50 lakh), if DA crosses 50%.
3. HRA for 7th CPC and 3rd PRC employees will be paid @ 10 %, for city Z (population of below 5 lakh), if DA crosses 50%.

Highlights of HRA for 7th CPC Central Govt. employees, Armed forces and PSUs or CPSEs:

1. The rates of HRA will not be less than Rs. 5400/-, 3600/- & 1800/- at X, Y & Z class cities respectively.
2. The rates of HRA will be revised to 27%, 18%, and 9% for X, Y & Z class cities respectively when Dearness Allowance (DA) crosses 25 percent and further revised to 30%, 20%, and 10% when DA crosses 50%.
3. The term “basic pay” in the revised pay structure means the pay drawn in the prescribed pay levels in the Pay Matrix and does not include Non-Practising Allowance (NPA), Military Service Pay (MSP), etc., or any other type of pay like special pay, etc.
4. Special orders on the continuance of HRA at Delhi (X’ class city) rates to Central Government employees posted at Faridabad, Ghaziabad, NOIDA, and Gurgaon, at Jalandhar (‘ Y’ class city) rates to Jalandhar Cantt. at “Y” class city rates to Shillong, Goa & Port Blair and HRA at par with Chandigarh (‘Y’ class city) to Panchkula. S.A.S. Nagar(Mohali) has been allowed to continue to vide Para ‘4’ of MoF O.M. No. 2/5/2014-D.II(B) dated 21.07.2015 and O.M. No. 2/2/2016-E.II(B) dated 03.02.2017, shall continue till further orders.

Classification of Cities for HRA as per 7th CPC – X Y Z Classification of Cities for HRA 2020

x y z classification of cities for HRA 2021

Classification of cities for grant of HRA, House Rent Allowance for 7th CPC Central Govt. employees, Armed forces and PSUs or CPSEs:

The below table tells you the classification of cities across all the states of India. In the table, there are only two classifications X and Y, for the purpose of HRA. The remaining cities / towns in various States / UTs which are not covered by classification as “X” or “Y”, are classified as “Z” for the purpose of HRA.

UA – Urban Agglomeration, M.Corpn. – Municipal Corporation

Classification of cities for grant of HRA, House Rent Allowance for 7th CPC Central Govt. employees ,Armed forces, CPSEs or PSUs