Union Cabinet gives nod for reclassifiation and upgradation of cities, towns

By
Daily Excelsior
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NEW DELHI, May 30:
The Union Cabinet, chaired by Prime Minister Narendra Modi, has given its approval to the proposal of the Ministry of Finance, Department of Expenditure for reclassification and upgradation of certain cities and towns on the basis of Census-2011, for the purpose of grant of House Rent Allowance (HRA) and Transport Allowance to Central Government employees.
An official statement said here on the basis of the final population figures of Census-2011, two cities have qualified for being upgraded from ‘Y’ class to ‘X’ class and 21 cities have qualified for being upgraded from ‘Z’ to ‘Y’ class for the purpose of HRA. Six cities have qualified for being upgraded from “other places” to be specified higher class for the purpose of Transport Allowance.
The revised classification of cities shall take effect from May 1, 2014. It said the impact on the exchequer on account of upgradation of 29 cities, would be nearly Rs.128 crore for the year 2014-15. HRA and Transport Allowance are admissible to Central Government employees depending upon employees’ Basic Pay and Grade Pay and the classification of the cities and towns where they are posted.
The existing classification of cities and towns in different classes viz. ‘X’, ‘Y’ and ‘Z’ for the purpose of HRA and 13 specified cities classified earlier as ‘A-1’/ ‘A’ and “Other Places” for the purpose of Transport Allowance, is as per the criterion recommended by the 6th Central Pay Commission. The release said the existing qualifying limits of population for classification for HRA purpose is 50 lakhs and above for ‘X’, 5 – 50 lakhs for ‘Y’ and below five lakhs for ‘Z’ class city. It said transport allowance is payable at ‘higher rates’ in 13 specified cities classified earlier as ‘A-1’ (that is those cities having population of 20 lakhs & above) and at ‘lower rates’ in all other places.
The classification of cities and towns for this purpose is revised on the basis of their population as reflected in the decennial census report. The existing classification of various cities and towns is based on 2001 Census figures, the release said. The criterion of population for this purpose has been followed as recommended by the Central Pay Commissions. (UNI)

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