8th Pay Commission HRA changes: 5 employee bodies recommend house rent allowance up to 40%; check details

The 8^th Pay Commission (8^th CPC) is holding meetings with employee and pension bodies as well as other stakeholders in Lucknow today (June 23, 2026). They have a packed schedule with 30 interactions lined up. A major point of discussion of the 8^th CPC members with different stakeholders is the demand to raise the house rent allowance (HRA) rates, which currently stand at 10%, 20% and 30%. Different employee and pensioner bodies have proposed different HRA rates, but nearly all are pushing for a significant increase, arguing that it would help a large number of employees cope with rising rents.


Manjeet Singh Patel, national President of All India NPS Employees Federation (AINSPEF), told ET Wealth Online that employee bodies are worried because in big cities like Delhi and Mumbai, rents are sky high and it’s tough for lower-level employees to manage these steep costs.


“A Level-1 employee in a city like Delhi receives only Rs 5,400, which is calculated as 30% HRA. However, renting even a small 2BHK flat in Delhi generally costs at least Rs 12,000 per month. To address this issue, we have demanded a minimum HRA of 36% for X-category cities. If this demand is accepted, the HRA could increase to at least Rs 13,600 after the implementation of the 8th Central Pay Commission (8th CPC),” says Patel.

Also Read: 8th Pay Commission salary calculator: Check estimated arrears of Level 15-18 central government employees at 2.0, 2.15, 2.57 fitment factors

House rent allowance (HRA) in 7^th Pay Commission

The 7^th Pay Commission decided on three HRA rates at the time of implementing its report. The rates were 8%, 16% and 24% for Z, Y and X categories, respectively. When DA reached 50% in January 2024, the Finance Ministry increased the rates to 10%, 20% and 30%, respectively. Here we take you through the HRA recommendations five major employee bodies have put forward before the 8^th Pay Commission.

Also Read: 8th Pay Commission: Why defence employees’ body wants changes in inflation index used for DA, DR calculations

HRA demands by NC-JCM

The National Council – Joint Consultative Machinery (staff side), (NC-JCM), which is the umbrella body of all central government employees, in its memorandum submitted to the 8^th Pay Commission has recommended 40% (X cities), 35% (Y cities) and 30% (Z cities) HRA rates. The employee body has suggested increasing HRA with a rise in DA.

HRA demands by IRTSA

The Indian Railways Technical Supervisors’ Association (IRTSA), which represents technical employees in Indian Railways, has recommended that the current three-tier HRA classification should be made into four as per the rates given below-

• A class cities (40%+DA): Population 50 lakh and above.
• B class cities (30%+DA): Population 20 Lakh to 50 lakh
• C class cities (20%+DA): Population 5 Lakh to 20 lakh
• D class cities (10%+DA): Population below 5 lakh

IRTSA has also suggested that HRA be linked to the Consumer Price Index or DA. The rates shall automatically increase by 25% whenever DA goes up by 25%, says IRTSA in its memorandum.

HRA demands by AIDEF

The All India Defence Employees’ Federation (AIDEF), which represents a large number of defence civilian employees, has recommended 40% (X cities), 35% (Y cities) and 30% (Z cities) HRA rates to the 8^th Pay Commission.

HRA demands by FNPO

The Federation of National Postal Organizations (FNPO), the key body of postal employees in India, has recommended HRA rates at 30%, 35% and 40% for Z, X and Y cities. FNPO says that HRA should be linked to DA and should also be extended to pensioners.

HRA demands by AINSPEF

AINSPEF, in its memorandum, has pushed for three HRA rates. For X, Y and Z cities, it has proposed HRA rates at 36%, 24% and 12%, respectively. The employee body has recommended DA to be merged with basic salary when it crosses 25% and the remaining DA to be provided on new basic salary.