House Rent Allowance (HRA) of Employees Should Increase in Budget 2025-26?
House Rent Allowance (HRA) of Employees Should Increase in Budget 2025-26?
Should the Budget for 2025–2026 Increase Employees’ House Rent Allowance (HRA)?
I’ll go into great detail about the House Rent Allowance hike and the 2025–2026 Budget here. During the first week of June 2025, the Federal Government of Pakistan will announce the Fiscal Budget 2025-26. Employees have numerous demands that the government must meet. Raising the House Rent Allowance rates is one of the main demands made by government workers.
Budget 2025–2026 and the House Rent Allowance Increase (at the request of employees)
If we go back 10 years, the government announced an increase in HRA that took effect on July 1st, 2018. Prior to this, in 2008, the government raised HRA. In addition to a 50% rise in HRA in 2018, employees already get House Rent Allowance at 30% and 45% beginning of the Revised Pay Scales 2008.
The current rates of House Rent Allowance in big cities and small cities/and rural areas.
Current HRA in Big Cities / Special Cities
BPS HRA per month
BPS-01 2006
BPS-02 2049
BPS-03 2120
BPS-04 2187
BPS-05 2255
BPS-06 2316
BPS-07 2384
BPS-08 2474
BPS-09 2579
BPS-10 2670
BPS-11 2778
BPS-12 2940
BPS-13 3135
BPS-14 3321
BPS-15 3524
BPS-16 4091
BPS-17 6650
BPS-18 8715
Current HRA in Small Cities / Rural Areas
BPS HRA per month
BPS-01 1337
BPS-02 1366
BPS-03 1413
BPS-04 1458
BPS-05 1503
BPS-06 1544
BPS-07 1589
BPS-08 1649
BPS-09 1719
BPS-10 1780
BPS-11 1852
BPS-12 1960
BPS-13 2090
BPS-14 2214
BPS-15 2349
BPS-16 2727
BPS-17 4433
BPS-18 5810
Comparison of HRA and Rates of Houses on Rent 2025
When compared to the present rates of houses on rent in both large and small cities, the HRA rates mentioned above are negligible. In both the same city and other cities, the cost of renting a home varies depending on where you live. The difference between house rental rates in the same cities is even greater than 100 percent. A five-marla, one-story house in Lahore, for instance, would rent for over 20,000/-per month in the city’s common areas, while in certain other parts of the city, the same area property would rent for more than 50,000/-per month. From BPS-01 to BPS-18, the employees receive HRA in the range of Rs. 2006 to Rs. 8715 a month. As you may guess, there is a significant discrepancy between the HRA amount that employees receive and the real amount that government employees pay for housing.
Given the aforementioned information, the government ought to raise the House Rent Allowance by at least 100% on the first of the updated pay scales for 2022. They will get some relief in this way.
How much HRA employees will get if the Government grants HRA on the initial of the 2022 Pay Scales?
BPS Basic Pay (2022 RPS) HRA (30%) HRA (45%)
BPS-01 13550 4065 6098
BPS-02 13820 4146 6219
BPS-03 14260 4278 6417
BPS-04 14690 4407 6611
BPS-05 15230 4569 6854
BPS-06 15760 4728 7092
BPS-07 16310 4893 7340
BPS-08 16890 5067 7601
BPS-09 17470 5241 7862
BPS-10 18050 5415 8123
BPS-11 18650 5595 8393
BPS-12 19770 5931 8897
BPS-13 21160 6348 9522
BPS-14 22530 6759 10139
BPS-15 23920 7176 10764
BPS-16 28070 8421 12632
BPS-17 45070 13521 20282
BPS-18 56880 17064 25596
Looking at the rates above, we can see that they are also far below what the employees actually pay for their homes. Therefore, the minimum should be raised by the government by 100% of the original Revised Pay Scales 2022.
