8th Pay Commission: How HRA Hike Proposal Could Add Nearly Rs 15,800 Monthly For Level 5 Employee

8th Pay Commission ToR was announced in November 2025. (AI Image)

Central government employees could see a sizeable increase in their House Rent Allowance (HRA) if the demands being placed before the 8th Pay Commission by employee unions and other stakeholder groups are accepted. HRA is calculated with reference to an employee’s basic pay as well as the classification of the city where they are posted. Under the 7th Pay Commission, the allowance was originally set at 24 per cent of basic pay for X-category cities, 16 per cent for Y-category cities and 8 per cent for Z-category cities.

Those rates were subsequently revised after the Dearness Allowance (DA) crossed the 50 per cent threshold in January 2024. HRA was raised to 30 per cent for X-category cities, 20 per cent for Y-category locations and 10 per cent for Z-category cities.

With rents and household expenses continuing to put pressure on salaries, employee and pensioner organisations are now seeking a higher HRA structure under the 8th Pay Commission.

One of the prominent proposals has come from the National Council of the Joint Consultative Machinery (NC-JCM). It has sought an HRA rate of 40 per cent for X-category cities, 35 per…

Original source: https://www.timesnownews.com/business-economy