8th Pay Commission- How much will HRA increase according to cities? Know the details

8th Pay Commission- Whenever an employee talks about the 8th Pay Commission, his focus is only on the fitment factor and basic salary, whereas the calculation of monthly salary is not complete with just basic salary. The actual ‘take-home’ salary includes many allowances. In such a situation, under the 8th Pay Commission, along with the basic salary, there can be big and important changes in the rules of these allowances as well.

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House Rent Allowance
HRA rates will be reset in the 8th Pay Commission
Changes in Medical Allowance
Travel allowance will increase

According to media reports, the government can re-formulate the existing structure of House Rent Allowance (HRA), Medical Allowance and Travel Allowance in the new Pay Commission according to rising inflation. If this happens, this change will bring double happiness to millions of employees. So let us now tell you what changes can happen in the 8th Pay Commission and how it will affect your pocket.

House Rent Allowance

The allowance that the government gives to its employees for living in a rented house is called House Rent Allowance or HRA. It is worth noting that the 7th Pay Commission had divided cities into three categories according to their population. These include metros, big cities and small cities. It also included a rule that when dearness allowance crosses 25 percent, the rates will become 27, 18, 9 percent. Similarly, when DA crosses 50 percent, the rates of HRA will become 30, 20, 10 percent.

HRA rates will be reset in the 8th Pay Commission

It is believed that as soon as DA becomes zero in the 8th Pay Commission, the HRA rates will also return to their original base rates i.e. 24, 16, and 8 percent. The biggest advantage of this is that HRA will be calculated on the new and increased basic salary.

For example, if the current basic salary of an employee is Rs 35,400 and he lives in a metro city, then his HRA at the rate of 30 percent will be Rs 10,620. In such a situation, if your basic salary increases to Rs 90,000 in the 8th Pay Commission, then your new HRA will be Rs 21,600 based on the rate of 24 percent.

Changes in Medical Allowance

The 7th Pay Commission had abolished the fixed medical allowance for most employees and replaced it with the CGHS health scheme. However, pensioners who are not covered under CGHS still get a fixed medical allowance. Currently, pensioners get a fixed medical allowance (FMA) of Rs 1,000 per month.

There has been a huge increase in the cost of medicines and doctor’s fees since 2017. In view of this, it is believed that the 8th Pay Commission can increase the fixed medical allowance for pensioners from Rs 1000 to at least Rs 2000 per month.

Travel allowance will increase

Employees are given travel allowance to travel from their home to office. Currently, whenever DA increases, it also affects the total amount of TA. In such a situation, it is expected to increase in the 8th Pay Commission as well. If the current DA is merged with the basic salary in the 8th Pay Commission, then the calculation of travel allowance will change completely.