In the mind of every central government employee, the dream of owning a house certainly holds the first place. We can see some central government employees living in government quarters all through their service period and then searching for a rented house. In majority of the “Group C” employees, this happens to be the case.
In its recommendation, the 6th pay Commission had prescribed that the central government has to avoid giving loans and advance and if necessary, it can make an agreement with public sector banks to provide such benefits. It had also laid down that the interest offers given to central government employees can be directly paid to the banks.
Presently, for loans up to Rs.50, 000/- (given as House Building Advance to the central government employees), the interest rate is 6%; for larger loans, the interest rate is calculated as follows: for loans up to 1,50,000 the interest is 6.5%, for loans up to 5,00,000 the interest is 8.5% and for loans up to 7,50,000, the interest is 9.5%.
Considering the high price of the building materials and the wages of the construction workers, the loan of Rs, 50, 000 which the government provides will disappear like a drop of rainwater that falls in to the ocean.
All the employees expect that the 7th pay commission has to consider the situation of the central government employees and provide suitable recommendations in this respect. When giving loans to a person, the Public and private sector banks follow certain procedures. The government also needs to follow some procedures when proving Housing loans. It has to come forward to discard the outdated rules and regulations. It has to follow only the necessary and practical procedures while providing HBA.
The government has to give loans with an interest rate that is not more than 6%. For the differently abled, it has to provide HBA without interest. HBA has to be given twice during one’s service period. When both husband and wife are government employees, the loan amount also needs to be doubled. Other than the basic pay, even the Grade Pay needs to be considered and a minimum of Rs. 15,00,000 has to be provided as HBA. When the government has the heart to help all this would be possible.