7th Pay Commission: BSNL, Air India, BHEL cannot afford revised salaries to employees

Key highlights

• Out 244, only 100 PSUs can afford giving higher allowance to their employees
• BSNL, Air India and BHEL may not be able to provide revised salaries
• PM Modi and FM Jaitley likely to meet on June 28 to take final call on HRAs

With central government employees still waiting for higher allowances under 7th Pay Commission, there are companies which cannot afford salary hikes due to huge losses, a media report said.

There are 244 central public sector enterprises operating in the country and are liable to give higher allowance to not only central government employees, but also officers and non-official staff working with them. 

According to a report by Business Today, there are only 100 public sector undertakings (PSUs) that can afford criteria set by the Third Pay Revision Committee (PRC). In other words, there are only 100 public sector companies which will be revising the salaries of their employees. 

ALSO READ: 7th Pay Commission: Cabinet to take up HRA allowance once Jaitley returns from South Korea

Big companies  with huge manpower like, BSNL, Air India, Bharat Heavy Electricals Limited (BHEL) are some companies which are suffering from losses and cannot increase salaries of thier employees, the report said. 

Reportedly, Department of Public Enterprises (DPE) formed PRC last year in July. That was the same time when Union Cabinet had approved 7th Pay Commission recommendations. 

Moreover, a separate media report said Prime Minister Narendra Modi and Finance Minister Arun Jaitley held a meeting to finalise the house rent allowance (HRA) as per 7th CPC.

ALSO READ: 7th Pay Commission: 27% or 30%? What will Cabinet approve?

According to a report by OneIndia, both Modi and Jaitley said that HRA should be fixed at 27% and the revised higher allowance should be rolled out from July, 2017 onwards. Both thje leaders have decided to discuss the matter on June 28 during Cabinet meet. 

7CPC had recommended that HRA to be paid at the rate of 24%, 6% and 8% of the new basic pay depending on type of city. It also recommends HRA to be revised to 27%, 18% and 9% once dearness allowance touches 50%. 

However, employee unions have demanded HRA at the rate of 30%, 20% and 10%.

ALSO READ: 7th Pay Commission: House Rent Allowance may be hiked, news likely soon

The Committee formed by Jaitley last year to review the recommendations, has already submitted its report to the Cabinet and recommended HRA at 25-27% as against employees' and pensioners' demands of 30%.