7th Pay Commission recommendation for Transport Allowance

| July 11, 2016

7th Pay Commission recommendation for Transport Allowance

Though cabinet has deferred all the allowance to High Level Committee. But it is expected that Committee nominated to access all the allowances will recommend same allowance as was given by 7th CPC report.

Transport Allowance

8.15.44 Transport Allowance (TPTA) is granted to cover the expenditure involved in commuting between place of residence and place of duty. The existing rates are as under:

Employees Drawing A1/A Class City(pm) Other Places( pm)
GP 5400 and above 3200 + DA 1600 + DA
GP 4200 to GP 4800 and other employees drawingGP<4200 but pay in the pay band equivalent to ₹7440and above 1600 + DA 800 + DA
GP<4200 and pay in the pay band below ₹7440 600 + DA 300 + DA

8.15.45 Moreover, officers drawing GP 10000 and higher, who are entitled to the use of official car, have the option to avail themselves of the existing facility or to draw the TPTA at the rate
of ₹7,000+DA pm. Differently abled employees are granted this allowance at double the rate, subject to a minimum amount of ₹1,000 plus DA.

8.15.46 Many representations have been received regarding Transport Allowance. Most of them advocate granting the allowance at the same rate to all employees, irrespective of their place of posting, on the grounds that fuel prices affect everybody equally.

Analysis and Recommendations

8.15.47 The Commission notes that TPTA is fully DA-indexed.

8.15.48 The first issue to be considered is whether the rate of Transport Allowance should be the same for all places. There are arguments both for and against this view.

8.15.49 Proponents of the idea argue that petrol prices are almost same everywhere. Moreover, public transport system is better developed in many of the A1/A Class cities, thereby reducing the cost of commuting significantly. The argument, therefore, is that A1/A category places do not need to have a higher rate.

8.15.50 Opponents point out that the categorization of A1/A has been abolished for other purposes (like HRA, CCA) but retained for Transport Allowance. Incidentally, only 13 cities fall under this categorization: six in A1, viz., Hyderabad, Delhi, Bengaluru, Greater Mumbai, Chennai, Kolkata and seven in A, viz., Ahmedabad, Surat, Nagpur, Pune, Jaipur, Lucknow and Kanpur. Recently, six more cities, viz., Patna, Kochi, Kozhikode, Indore, Coimbatore and Ghaziabad have been added to A1/A categories, making it nineteen in all. (Incidentally, vide a recent notification No. 21(2)/2015-E.II(B) dated 06.08.2015, the use of term “A1/A” has been dropped for these nineteen cities. Hence, the Commission will refer to these nineteen cities as “Higher TPTA cities.”). In all these places the commuting distances are far more than in other cities. Moreover, the public transport system is not as developed as it should be in all these places. Therefore, it is argued, the distinction should remain.

8.15.51 After considering both the viewpoints, the Commission is of the view that by and large the commuting distances and associated difficulties involved in Higher TPTA cities are much more compared to other places. Hence, the argument that the distinction should stay is a valid one.

8.15.52 The second issue is whether Transport Allowance should be the same for all personnel posted at the same place. Here the Commission feels that a question of status of employee is involved and hence, complete parity is not possible.

8.15.53 Regarding the optimal rate of Transport Allowance, the Commission notes that the allowance is already fully DA indexed. Therefore, since DA has already reached 119 percent and is likely to rise further before the implementation of our report, the following rates of Transport Allowance are recommended:

Pay Level Higher TPTA Cities( pm) Other Places( pm)
9and above 7200+DA 3600+DA
3 to 8 3600+DA 1800+DA
1 and 2 1350+DA 900+DA

8.15.54 Officers in Pay Level 14 and higher, who are entitled to the use of official car, will ave the option to avail themselves of the existing facility or to draw the TPTA at the rate of ₹15,750+DA pm. Differently abled employees will continue to be paid at double rate, subject to a minimum of ₹2,250 plus DA.

Category: Finance Ministry, News, Seventh Pay Commission

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