The Cabinet, headed by Prime Minister Narendra Modi approved the recommendations of the Seventh Pay Commission last month only.
Panel headed by AK Mathur had recommended recommended a 23.55 per cent overall hike in salaries, allowances and pension involving an additional burden of Rs 1.02 lakh crore, or nearly 0.7 per cent of GDP.
The further decision to hike the allowance will be taken by a Committee headed by Finance Secretary. The decision expected only after 4 months.
Notification towards implementation of the Pay Commission is likely to be issued soon.
The government in January had set up a high-powered panel under the Cabinet Secretary to process the recommendations of the 7th Pay Commission that will have a bearing on remuneration of nearly 50 lakh central government employees and 58 lakh pensioners.