KAVALIPOST

Saturday, 19 December 2015

Analysis And Recommendations Of 7th Pay Commission On House Rent Allowance

Allowances related to Housing : House Rent Allowance (HRA) : Presently, HRA is payable at the following rates:
There are a large number of demands for paying HRA as a percentage of (Basic Pay + DA), instead of as a percentage of Basic Pay alone, as at present. Representations have also been received regarding enhancement of percentage rates and having only two classifications of Metros and Non-metros (instead of the present classification of X, Y and Z cities).
PBORs of uniformed forces have vehemently argued for doing away with the concept of Authorized Married Establishment and the requirement of a minimum age of 25 years for grant of Compensation in Lieu of Quarters (CILQ).
Analysis and Recommendations: Compensation towards the housing needs of Central Government employees is covered in three ways:
1. As a component of Basic Pay when it is initially fixed (based upon the Aykroyd formula)
2. As a constituent of Dearness Allowance [the AICPI(IW), on which the DA is currently based includes a weight of 15.27% towards housing], and
3. In the form of House Rent Allowance
In view of the fact that the DA calculation methodology that is being followed does include a certain weightage for housing, the demand to pay HRA as a percentage of Basic Pay + DA is not justified.
To arrive at the appropriate rates of HRA, the Commission used a two-fold approach: (i) It compared the rise in housing compensation with the cost of housing in major X, Y and Z category cities over the period 2006 to 2013, and (ii) It compared, de novo, the HRA after the rise in Basic Pay proposed with representative house rents in major X, Y and Z category cities.
For (i) above, the table of comparison (for a hypothetical employee whose Basic Pay was Rs.1000 in 2006) is given below:
As is clear from the above table, compensation for housing in 2013 was 1.79 times that in 2006 for Class X cities, 2.07 times for Class Y cities and 2.92 times for Class Z cities.
During the same period, the weighted (by population of cities) average rise31 in housing index for Class X cities was 1.69 times, for thirty most populated Class Y cities it was 2.10 times, and for twenty-five most populated Class Z cities it was also 2.10 times.
Thus, it can be safely concluded that the rise in housing compensation has largely kept pace with the rise in rental values in all categories of cities.
However, if a zero-based comparison of HRA with house rents is carried out the Commission observed that today there are websites that give a good idea of the prevalent house rents in various cities. From the information available on the websites, it was observed that with the increase in Basic Pay proposed (and consequent rise in HRA with the rationalized percentages), most of the employees will be able to afford a rented house as per their entitlement.
The Commission also took note of the link between increase in HRA and increase in house rent. There was a sharp rise in the index from the first half of 2009, immediately following VI CPC recommendations. The All India House Rent Index32 chart given below demonstrates this:
Considering all these factors, and in line with our general policy of rationalizing the percentage based allowances by a factor of 0.8, the Commission recommends that HRA should be rationalized to 24 percent, 16 percent and 8 percent of the Basic Pay for Class X, Y and Z cities respectively.
However, the Commission also recognizes that with the current formulation, once the new pay levels are implemented, the compensation towards HRA will remain unchanged until such time as the pay and allowances are next revised. Going by the historical trend this event is likely to be a decade away. Some representations have been received stating that towards the later part of the ten year period the HRA compensation falls considerably short of the requirement. Having regard to this, the Commission also recommends that the rate of HRA will be revised to 27 percent, 18 percent and 9 percent when DA crosses 50 percent, and further revised to 30 percent, 20 percent and 10 percent when DA crosses 100 percent.
Currently, in the case of those drawing either NPA or MSP or both, HRA is being paid as a percentage of Basic Pay+NPA or Basic Pay+MSP or Basic Pay+NPA+MSP respectively. HRA is a compensation for expenses in connection with the rent of the residential accommodation to be hired/leased by the employee and is graded based on the level of the employee, and therefore should be calculated as a percentage of Basic Pay only. Add-ons like NPA, MSP, etc. should not be included while working out HRA.
Keyword: HRA, House Rent Allowance, 7th CPC HRA, 7th CPC House Rent Allowance, 7th Central Pay Commission, 7th CPC Report, HOUSE RENT ALLOWANCE
 
 

Difference between National Pension System (NPS) and Atal Pension Yojana (APY)

DIFFERENCE BETWEEN NATIONAL PENSION SYSTEM  (NPS) AND ATAL PENSION YOJANA (APY)


Recently Central Government launched one more pension scheme called Atal Pension Yojana. So what is the difference between existing National Pension System  (NPS) and Atal Pension Yojana (APY)?



DIFFERENCE OF NPS AND APY


Let us point one by one.

1) Age of joining–

The age for joining the National Pension System  (NPS) is 18-60 years. Whereas for Atal Pension Yojana (APY) the age eligibility is 18-40 years.

2) Who can join?

All Indian citizens can join NPS (whether they are resident or non-resident). Whereas for APY only Resident Indians are allowed to join.

3) Pension Slabs–

In case of NPS, there is no such standard pension slab. However, in APY the pension slabs are fixed like Rs 1,000/-, 2,000/-, 3,000/-, 4,000 and 5,000/- per month.

4) Types of Accounts–

In case of NPS, you have two types of accounts. One is Tier I and Tier II. Whereas, in case of APY there is no such differentiation.

5) Minimum and Maximum Contributions–

In case of NPS

For Tier I

You must contribute a minimum of Rs. 6,000 per annum. The minimum of Rs. 500 per contribution is required. In addition, you must contribute minimum 4 contributions per year. There is no maximum limit.

For Tier II


You have to contribute the minimum of Rs. 1,000 contribution at a time of account opening.

Subsequently, you have to contribute a minimum of Rs. 250 per subsequent contributions. Minimum Balance of Rs. 2,000 be maintained at the end of Financial Year (April-March). There is no maximum limit.


In case of APY

In case of APY, the minimum and range depends on the age. For example, the minimum monthly contribution for 18 years of age person is Rs.42 to get Rs.1,000 monthly pension. At the same time, the minimum monthly contribution for 40 years age person is Rs.291.

There is no upper limit of investment set for both NPS Tier I and Tier II Account. However, in case of APY, the maximum limit for 18 years of age is 210 to get a monthly pension of Rs.5, 000. At the same time, the maximum monthly contribution for 40 years of age person is Rs.1, 454.

6) Premature Withdrawal–

For NPS–

Tier I
  • You can withdraw at age 60, 40% of accumulated amount be used to buy annuities from an IRDA approved insurance company, A phased withdrawal is also allowed, but the lump sum balance should be withdrawn before the age of 70 years.
  • To exit before 60 years age, only 20% of the lump sum to be cash withdrawal, 80% to be used to buy annuities from an IRDA approved insurance company.
  • On death before the age of 60, the nominee receives a lump sum.
Tier II

There is no restriction and you can withdraw it at any point of time.
For APY–
  • Once you attain the age of 60 years, then you have no option but to utilize 100% of the accumulated amount for a pension. No partial withdrawal is permitted.
  • You cannot withdraw in APY. Withdrawal is available only in case death or terminal diseases.
7) Choice of investment–

In case of NPS, you have primarily two choices. One is Auto Choice where the asset allocation among equity, Corporate Bonds, and Government Bonds are adjusted automatically based on age of a subscriber. Another is Active Choice, where you select your asset allocation (subject to the maximum of 50% in equity). In addition, you have a freedom to choose fund managers to manage your money.

In case of APY, there are no such options.

8) Tax Benefit–

While Investing–
The tax benefit in NPS will be available only in case of Tier I account, but not for Tier II account.

Employer contribution to the NPS on behalf of an employee will get a deduction from his income (i.e. employer’s income) an amount equivalent to the amount contributed or 10% of BASIC SALARY + DA of the employee, whichever is less. (Section 36 (1) (iv a) of the Income Tax Act 1961).

Employer’s contribution to NPS on behalf of the employee is treated as perquisite in the hands of the employees. However, it is deductible u/s 80CCD (2) of the IT Act, 1961 to the extent of 10% of basic salary. This deduction is over and above the limit of Rs.1.5 lac u/s 80 CCD (1). This will lessen the tax burden of the employee to the extent of amount deductible u/s80CCD (2) of the IT Act, 1961.
Contribution by an individual employee is eligible for a deduction from Income under Section 80CCD (1) of the IT Act 1961 up to Rs 1.5 Lakhs. However, investments under Section 80C Section 80CCC and 80CCD(1) should not exceed Rs.1.5 lakhs per assessment year to claim the deduction.

An additional tax benefit of Rs.50,000/- under section 80CCD (1B) per year (applicable from FY 2015-16/AY 2016-17) for NPS investments.

There are no such tax benefits of investing in APY.
While receiving pension–

Both NPS and APY pension is treated as taxable income under the head of a salary.

9) Where to open an Account?

In case of NPS, you have to open the account by visiting the nearest Point of Presence (POP) branch to open the account. This account could also be opened online through CAMS online, India Post etc.

In case of APY, you have to approach the bank/Post Office where your savings bank account is held.

10) Nomination facility-

In case of NPS, the nomination is not mandatory. However, you can nominate a maximum of 3 members. The total sum sharing of all these nominees must be equal to 100%.
In case of APY, the nomination is mandatory. You have to provide nominee details while opening the account.

11) How much return you can expect?

In case of NPS, returns are not guaranteed. It depends on the performance of the fund. Whereas, in case of APY, returns not disclosed. But set the fixed monthly pension.

12) Government contribution–

In case of NPS, the Central Government and State Government employee’s contribution are fixed at 10% of the Basic and Dearness Allowance (DA) per month which is matched by an employer contribution of the same amount. For the rest of the people, there is no Government contribution.
In APY, the Government will also contribute 50% of the total contribution or Rs. 1,000/- per annum, whichever is lower, to the eligible APY account holders who join the scheme during the period 1st June, 2015 to 31st December, 2015. The Government contribution will be for 5 years from FY 2015-16 to 2019-20. This contribution to APY will not be applicable to those members who are-
  • Income Tax Payers.
  • Employees’ Provident Fund & Miscellaneous Provision Act, 1952.
  • The Coal Mines Provident Fund and Miscellaneous Provision Act, 1948.
  • Assam Tea PlantationProvident Fund and Miscellaneous Provision, 1955.
  • Seamens’ Provident Fund Act, 1966.
  • Jammu Kashmir Employees’ Provident Fund & Miscellaneous Provision Act, 1961.
  • Any other statutory social security scheme.
13) Who manages?

NPS is managed by PFRDA. The APY scheme is administered by the PFRDA/Government.
14) Permanent Account Number–
In case of NPS, you will get the unique Permanent Retirement Number (PRAN). By quoting this PRAN, you can operate NPS sitting across India. There is no such facility in APY.

15) How many accounts, one can open?

For both NPS and APY an individual can open only ONE account.

Courtesy : http://finaclesolution.blogspot.in/
 
 
 

Government proposes to construct houses for serving and retired CG employees

GOVERNMENT OF INDIA
MINISTRY OF HOUSING AND URBAN POVERTY ALLEVIATION
LOK SABHA

STARRED QUESTION NO: 145
ANSWERED ON: 09.12.2015
Housing Scheme for Government Employees
CHARANJEET SINGH RORI
Will the Minister of HOUSING AND URBAN POVERTY ALLEVIATION be pleased to state:

(a) the housing satisfaction level of the Central Government employees in the country;
(b) whether the Government proposes to construct houses for serving and retired Central Government employees in various parts of the country;
(c) if so, the details thereof and the action taken/being taken by the Government in this regard;
(d) the details of schemes previously launched for serving and retired Central Government employees; and
(e) whether the Central Government Employees Welfare Organization (CGEWHO) proposes any special housing scheme for the Central Government employees and if so, the details thereof ?


ANSWER
THE MINISTER OF HOUSING & URBAN POVERTY ALLEVIATION
[SHRI M. VENKAIAH NAIDU]

(a) to (c) Yes, Madam. As part of fulfilling the housing satisfaction level of Government employees in the country, CGEWHO addresses housing shortage issues by providing housing to central government employees as per their demand, availability of land, feasibility of the project etc. The Central Government Employees Welfare Housing Organization (CGEWHO) has completed 30 projects consisting of 13927 Dwelling Units in various parts of the country for central government employees. In 2009, CGEWHO had conducted a demand survey in twenty cities across the country. Substantial demand was received from the employees in Pune, Nagpur, Patna, Dehradun, Chandigarh and Thiruvananthapuram as per details provided at Annexure- I. A request for all the six stations has been made to the respective State Governments for allotment of suitable land and the schemes will progress on allotment of the same.
(d) The CGEWHO has already completed 30 housing schemes consisting of 13927 Dwelling Units. It also has four schemes under progress, consisting of additional 3211 Dwelling Units in various parts of the country, as per details at Annexure-II.

(e) No, Madam.

*****
Annexure-I
DEMAND SURVEY OF CGEWHO IN 2009
Demand Survey for 20 cities of different states has been published in the ‘INDIAN EXPRESS’ All India Edition & CGEWHO’s official website www.cgewho.nic.in {NOW cgewho.in} with the last date as 24/08/2009. Nos of applications received in total are given here in under.

 
NAME OF STATION
Applications Received
Assam


1. Guwahati
226
Bihar


2. Patna
964
Chhatisgarh


3. Raipur
69
Goa


4. Goa
127
Gujrat


5. Vadodra
170
Himachal Pradesh


6. Shimla
244
Jammu & Kashmir


7. Jammu
42
Jharkhand


8. Ranchi
195
Karnataka


9. Mysore
334
Kerala


10. Thiruvananthapuram
630
Maharashtra


11. Nagpur
794

12. Pune
1610
Madhya Pradesh


13. Bhopal
139

14. Indore
73

15. Jabalpur
239
Uttar Pradesh


16. Agra
96

17. Allahabad
90
Uttara Khand


18. Dehradun
955
Union Territory


19. Chandigarh
2249
West Bengal


20. Siliguri
62
Study of Demand Survey : CGEWHO had categorized the pattern of the paid demand survey broadly in three depending on the No(s) of responses received (i) <100 ii="">100 and <500 iii="">500. The SIX Stations which was having 500+ applications were identified for future schemes and Response Amount cashed. Rest applications of different stations were refunded forthwith; after approval of GC.
NAME OF STATION Under Category-II
APPLICATIONS RECEIVED
NAME OF STATION Under Category-III
APPLICATIONS RECEIVED
1. Mysore
334
1. Agra
96
2. Shimla
244
2. Allahabad
90
3. Jabalpur
239
3. Indore
73
4. Guwahati
226
4. Siliguri
62
5. Ranchi
195
5. Jammu
42
6. Vadodara
170
6. Raipur
69
7. Bhopal
139


8. Goa
127


Annexure-II

The projects completed by CGEWHO are as under:
Project Name
Area (in acres)
No. of DUs
Chennai Ph-I
10
524
Nerul
6.2
384
Panchkula Ph-I
2
98
Noida Ph-I
12
692
Kolkata Ph-I
10
576
Kharghar
19
1230
Noida Ph-II
8.25
508
Gurgaon Ph-I
25
1088
Chandigarh
10
305
Bangalore
8.2
603
Hyderabad Ph-I
6.5
344
Kochi
3
43
Gurgaon Ph-II
13
852
Pune Ph-I
5
159
Noida Ph-III
16
980
Noida Ph-IV
13
720
Ahmedabad
6.41
310
Jaipur Ph-I
3
184
Hyderabad Ph-II
3
178
Panchkula Ph-II
5
240
Noida Ph-V
11
576
Lucknow Ph-I
4.5
130
Pune Ph-II
5
148
Chennai Ph-II
11.32
572
Jaipur Ph-II
6.8
572
Hyderabad Ph-III
6.5
380
Mohali Ph-I
9.56
603
Bhubaneswar Ph-I
5
256
Meerut Ph-I
1.91
90
Kolkata Ph-II
10.06
582

Following Projects are under construction as on date:
Station
Area (in acres)
No. of DUs
Bhubaneswar Ph-II
5
240
Greater Noida
38
2130
Mohali Ph-II
8.66
615
S A S Nagar
5.63
226

 

Special Campaign under Swachh Bharat Mission from 18th to 27th December, 2015

No. 18-41/2014-Bldg
Government of India
Ministry of Communications and Information Technology
Department of Posts
(Estates Division)
Dated: 17th December, 2015

To
            All Heads of Circles

Sub:     Special Campaign under Swachh Bharat Mission from 18th to 27th December, 2015.

Respected Sir/ Madam,
      
As you are aware, Government attaches great importance to the need for improving cleanliness including in the Government offices. Under Swachh Bharat Mission, Circles and field units have been undertaking Action Plan for furthering the cause of cleanliness. Futher, special focus needs to be given to the regular cleaning and proper upkeep of office premises, review and weeding of records and disposal of obsolete and unused items as well as repair, paining and sprucing of the street letter box and Post Office signage etc.  Digitization of records and documents would also ensure tidy workspaces.

             Now Government of India had decided to observe a Special Campaign in all Ministries/Departments from 18th to 27th December, 2015.  Accordingly, a day to day Action Plan for the said Special Campaign is enclosed compliance.

            The undersigned is directed to request you to forward Action Taken Report (attached) from time to time as mentioned therein as per the enclosed format including through email(estatesdnsbm@gmail.com). You are also requested to forward some good photographs of before and after action taken for uploading in social media and website.      
Yours faithfully,

 (K.R. Sharma)
 Director(E & MM)

Encl: (i) Action Plan


Annexure-I
Special Campaign (18th to 27th December 2015)

S.No
Activity
Period
Action Taken report to be sent by date
1
Cleaning of all  Post Offices(Departmental building)/RMS Units/Postal Staff College/Postal Training Centers(PTCs)/PSDs
18th to 27th  December 2015
28th  December 2015
2
Cleaning of Post Offices (Rented building) & RMS Offices
21st to 27thDecember 2015
28th December 2015
3
Cleaning of Branch Post Offices
18th to 27thDecember 2015
28th December 2015
4
Cleaning of Administrative Offices
19th, 20th & 23rd to 26th  December 2015
28th  December 2015
5
Cleaning of Postal Colonies
26th and 27thDecember 2015
28th December 2015
6
Review & Weeding of Old records and obsolete/unused items with due procedure
19th to 24thDecember 2015
28th December 2015
7
Meeting for raising awareness of their Postal Staff (Post offices/RMS/Administrative Offices.
19th , 20th December 2015 and 23rd to 26thDecember 2015
28th December 2015
8
Display banners on ‘Special Campaign’ in Circle Offices/Regional Offices/ Major Head Post offices & major RMS units.
By 20th December 2015
21st December 2015
9
Joint cleaning of the surroundings of Postal units with Local authorities.
23rd & 24thDecember 2015
28th December 2015
10
Digitization of POSB and PLI/RPLI records
18th to 27thDecember 2015
28th December 2015
11
Tree Plantation
19th, 20th  & 24th, to 27th December 2015
28th December 2015
Action to be taken by CGM: Uploading of photographs of Special Campaign drive with field unit on Social media and website of the department.
 
 
 

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