Can Level 5 employees get Rs 15.8k/month extra HRA?

By Sohail Khan 4 September 2026, 8:32 am

Synopsis

Employee associations are advocating for increased House Rent Allowance (HRA) rates for central government employees, aiming to tackle escalating rental prices in metropolitan areas. These suggestions have been forwarded to the 8th Pay Commission for evaluation. If accepted, Level 1-5 employees could see considerable boosts in their monthly HRA. The definitive report from the 8th Pay Commission will ultimately decide the revised HRA rates.

House rent allowance (HRA) is a large component of the salary of a central government employee. In the 7th Pay Commission, HRA rates for X, Y and Z category cities were 24%, 16% and 8%, respectively. But they were increased to 30%, 20% and 10% when dearness allowance reached 50% in January 2024. For a Level 1 employee with a basic pay of Rs 18,000 and who resides in an X-category city like Delhi, the HRA at 30% is Rs 5,400. For a Level 5 employee with a basic pay of Rs 29,200, it is Rs 8,760.

In their respective memorandums submitted to the 8th Pay Commission, employee and pensioner associations have argued that these amounts are quite low amid high rents in metropolitan and Tier II cities.

The National Council of the Joint Consultative Machinery (NC-JCM), All India New Pension Scheme Employees Federation (AINPSEF) and the All India Defence Employees' Federation (AIDEF) have recommended increasing the rates of all three current HRA slabs. The Indian Railways' Supervisors' Association (IRTSA), on the other hand, has suggested a four-Tier HRA. Pragatisheel Shikshak Nyaya Manch (PSNM) has suggested two-Tier HRA slabs, but it has recommended increasing these slab rates when DA reaches 25% and 50%, respectively.

Employee and pensioner bodies’ HRA recommendations for 8th Pay Commission

Organisations	8th CPC HRA slab recommendations
National Council of the Joint Consultative Machinery (NC-JCM)	40%	35%	30%
Federation of National Postal Organisation (FNPO)	30%		20%
All India New Pension Scheme Employees Federation (AINPSEF)	36%	24%	12%
Indian Railways' Supervisors' Association (IRTSA)	40%	30%	20%	10%
Pragatisheel Shikshak Nyaya Manch (PSNM)	30%	20%
All India Defence Employees' Federation (AIDEF)	40%	35%	30%

The NC-JCM, in its memorandum submitted to the 8th CPC, says that HRA should be indexed to dearness allowance so that it automatically adjusts with inflation. The employee body has also suggested that the classification of cities for HRA should also be done in five years compared to 10 years at present.

The NC-JCM has also recommended extending HRA to pensioners, citing that a big portion of pension goes into paying rent for pensioners who don’t own a house.

NC-JCM’s recommendations for 8th Pay Commission HRA rates

Population of Cities	Class of City	Proposed HRA (% of Basic Pay)
50 lakhs and above	X	40%
5–50 lakhs	Y	35%
Below 5 lakhs	Z	30%

How much extra monthly HRA may Level 1-5 employees get in 8th CPC?

Since the HRA is calculated on the basis of the basic pay, its rates will be known when the government notifies the fitment factor and revised basic pays with the 8th Pay Commission report. So, we will calculate the expected monthly HRA rise on two assumptions: a 2.1 fitment factor and the 40% HRA rate for X cities suggested by the NC-JCM in its memorandum. HRA estimates will be calculated for Level 1-5 employees.

Monthly 8th CPC HRA rise estimates for Level 1 employees

Basic pay (7th CPC)	₹ 18,000
X city 7th CPC HRA (At 30% of basic pay)	₹ 5,400
8th CPC revised estimated pay at 2.1x	₹ 37,800
8th CPC HRA estimate (at 40% of basic pay)	₹ 15,120
Increase in HRA/month	₹ 9,720

Monthly 8th CPC HRA rise estimates for Level 2 employees

Basic pay (7th CPC)	₹ 19,900
X city 7th CPC HRA (At 30% of basic pay)	₹ 5,970
8th CPC revised estimated pay at 2.1x	₹ 41,790
8th CPC HRA estimate (at 40% of basic pay)	₹ 16,716
Increase in HRA/month	₹ 10,746

Monthly 8th CPC HRA rise estimates for Level 3 employees

Basic pay (7th CPC)	₹ 21,700
X city 7th CPC HRA (At 30% of basic pay)	₹ 6,510
8th CPC revised estimated pay at 2.1x	₹ 45,570
8th CPC HRA estimate (at 40% of basic pay)	₹ 18,228
Increase in HRA/month	₹ 11,718

Monthly 8th CPC HRA rise estimates for Level 4 employees

Basic pay (7th CPC)	₹ 25,500
X city 7th CPC HRA (At 30% of basic pay)	₹ 7,650
8th CPC revised estimated pay at 2.1x	₹ 53,550
8th CPC HRA estimate (at 40% of basic pay)	₹ 21,420
Increase in HRA/month	₹ 13,770

Monthly 8th CPC HRA rise estimates for Level 5 employees

Basic pay (7th CPC)	₹ 29,200
X city 7th CPC HRA (At 30% of basic pay)	₹ 8,760
8th CPC revised estimated pay at 2.1x	₹ 61,320
8th CPC HRA estimate (at 40% of basic pay)	₹ 24,528
Increase in HRA/month	₹ 15,768