House Building Advance: RBE No.369/1987 – Liberalisation of HBA Scheme

No.F(E)Spl/87/Adv 3/12, dated 09.07.1987

Sub: Liberalisation of HBA Scheme for Central Government employees/ Railway employees.

1. Liberalisation of the existing rules governing the operation of House Building Advance Scheme has become necessary consequent upon introduction of the revised scales of pay based on the Report of the IV Central Pay Commission and due to increase in cost of construction.

2. After considering the recommendations made by an Inter-Ministerial Group constituted for this purpose, the President is pleased to approve the following changes in the existing scheme:

(I) Cost-Ceiling Limit:

The existing cost-ceiling limits as prescribed in the then Ministry of Works and Housing’s O.M. No.I/17015/6/83/H.III, dated 7th April, 1984 forwarded under this Ministry’s letter No.F(E)Spl./84/Adv 3/2, dated 12.04.1984, will be re-adjusted as under:

Where the Administrative Ministry is satisfied on the merits of the case, they may relax the cost-ceiling upto a maximum of 25% of the cost- ceiling mentioned above in individual cases.

(II) Quantum of House Building Advance (HBA):

(a)  The existing maximum limit of House Building Advance viz.,100 month’s pay subject to a maximum of Rs.1.25 lakhs, will be revised to 50 times the monthly basic pay or Rs.2.50 lakhs whichever be lower be for construction/ acquisition of a house.

(b)  The existing limit of 100 times monthly basic pay subject to a maximum of Rs.40000 will be revised to 50 times monthly pay or Rs.60000 whichever is less for enlargement of existing house; subject to the condition that the amount of advance will be limited to the repaying capacity of the  employee or the actual cost of construction/ acquisition/ enlargement, whichever be lower.

(III) Rates of Interest:

Existing rates of interest on House Building Advance as notified vide this Ministry’s letter No.F(E)Spl/86/Adv 3/9, dated 04.08.1986, is modified as under: