Extract of Defence Pension et al from 7 CPC
Report
(Pages 417 to 420)
Parity
in pension between pre and post Seventh CPC defence forces retirees
10.2.78. The differential in
pension between past and new retirees from the defence forces has been an issue
that has engaged the attention of the government and various Parliamentary Committees.
A number of committees and bodies have been appointed to examine the issue. This
differential arises on account of the fact that computation of pension depends
upon the pay scale of the person at the time of retirement. With the passage of
time and revision of pay scales by successive Pay Commission, the pay and
therefore the pension, of those retiring in later years undergoes a change.
10.2.79. The Estimates Committee
(1980-81), in its report on resettlement of Ex-Servicemen, noted that the
disparity in pension between past and present pensioners of equal rank was inequitable
and recommended that the matter should be examined and a just solution found.
10.2.80. The IV CPC, on the other
hand, observed that the amount of pension undergoes changes as and when the pay
scales are revised. Any attempt to equalise pension with reference to revised
scale of pay would, in fact, amount to the retrospective application of these
scales of pay.
10.2.81. In 1991 the government
set up a High Level Empowered Committee which recommended a One Time Increase
(OTI) in pension from 01.01.1992. All pre-1973 pensioners (JCOs/ORs/
Commissioned officers) were brought to the level of post-1973 retirees. Graded
addition with reference to post-1973 rates of pension was also made to determine
OTI in rates to bridge the gap to some extent up to post 1986 level.
10.2.82 The V CPC, after taking
into account the historical background including the recommendations of High
Level Committees, recommended that total parity may be brought between pre
01.01.1986 and post 01.01.1986 retirees. Thereafter, for all pre 01.01.1996 retirees,
their pension was consolidated as per the specified fitment formula. If the resultant
figure fell short of the pension applicable to the post 01.01.1996 retirees for
the same rank, it was to be stepped up to the minimum pension prescribed for
the same rank (Para 165.8). It went on to state that every Pay Commission gives
certain benefits in pay which are over and above the impact of inflation,
either due to upgradation of recruitment qualifications or change in job
contents. The benefits accorded on this account need not necessarily be passed
on to the pensioners. Thus, the additional benefits suggested by them for
future pensioners would not be fully available to the pre 01.01.1996 retirees.
It, however, recommended partial parity known as modified
parity in respect of pre and
post–01.01.1996 pensioners. This provided that in case the revised consolidated
pension of a person was less than 50 percent of the minimum of the revised pay
scale, it would be stepped up to that level.
10.2.83. The Commission notes
that a number of improvements have been brought about aimed at narrowing the
gap between past and current pensioners. These include:
a. All pre 1997 PBOR pensioners
have been brought at par with post 1997 pensioners.
b. Pension of all pre 2006 PBOR
pensioners has been reckoned with reference to notional maximum pay in post
01.01.2006 revised pay structure corresponding to the maximum pre VI CPC pay
scales as per fitment table of each rank with enhanced weightage awarded by the
group of Ministers.
c. A separate pay scale of ₹67,000–79,000 was created to
address the issue of disparity in pension of pre and post 01.01.2006 pensioners
at the level of Lieutenant General and equivalent in the other two services to
enable them to get pension at the rate of ₹36,500
and
d. Linkage of full pension with
33 years of qualifying service has been removed w.e.f. 01.01.2006 instead of
01.09.2008 in case of commissioned officers.
10.2.84. Pension
payout to defence forces personnel over time: The evolution of the pension regime over time and
the role of the Judiciary in settling the law on the subject has been detailed in
Chapter 10.1. There is clear evidence that governments have, over time,
progressively moved towards a liberalised regime for past pensioners. The VI
CPC has further provided for additional pension with advancing age. In the case
of defence forces personnel particularly, a number of improvements have been
effected after implementation of the VI CPC recommendations. Two Committees
were set up, one in 2009 and another in 2012, under the Chairmanship of the
Cabinet Secretary. Based on recommendations made by them, changes in the
pension rules were notified in years 2010 and 2013. Each notification went a
step further in bridging the gap between pre 2006 and post 2006 pensioners. What
this has effectively translated into is testified by examples of pension
fixation of defence forces personnel across groups who have retired in the past
decades. For example, a Lt Colonel (in GP of ₹8,000 in VI CPC, retired on 31 July, 1990 with a
basic pension of ₹2,703 per month. The basic pension got revised to ₹7,550 and ₹25,700 per month after
implementation of the V and VI CPC respectively. The basic pension was further
revised in September 2012 to ₹26,265. With the benefit of dearness relief39, the
pensioner is on date entitled to total pay out in terms of pension and dearness
relief of ₹57,520 per
month. Similarly, a Subedar (in GP of ₹4600 in VI CPC, retiring on 30 June, 1991 with a
basic pension of ₹1,300 per month got revised to ₹6,188 and ₹9,325 per month after implementation of the V and
VI CPC respectively. After further revision, the basic pension of the Officer
was fixed at ₹11,970 per month. With the benefit of dearness relief, the pensioner is
on date entitled to total pay out in terms of pension and dearness relief of ₹26,214 per month.
10.2.85. The illustrations point to
substantial increases in pension, across various categories of defence
pensioners.
10.2.86. Recommendations:
The concept of pension, so far as
Civilian employees including CAPFs are concerned, has undergone a complete
change. Entrants on or after 01.01.2004 on the civilian side are covered under
the National Pension System. In the case of defence forces personnel however,
the government has continued with the Defined Benefits pension regime. This
regime, as far as past pensioners is concerned, has also witnessed significant improvements
with a view to establishing parity between old and new pensioners. The Commission
has dwelt on the judicial pronouncements regulating the regime of pensions in detail
in Chapter 10.1.
10.2.87. The Commission recommends
the following with regard to fixation of pension for past defence forces
personnel retirees:
i. All the Defence Forces who retired prior
to 01.01.2016 (expected date of implementation of the Seventh CPC recommendations)
shall first be fixed in the Pay Matrix being recommended by this Commission, on
the basis of the Pay Band and Grade Pay at which they retired, at the minimum
of the corresponding level in the matrix. This amount shall be raised to arrive
at the notional pay of the retiree by adding the number of increments he/she
had earned in that level while in service, at the rate of three percent.
Military Service Pay shall be added to the amount which is arrived at after
notionally fitting him in the Seventh CPC matrix. Fifty percent of the total
amount so arrived at shall be the revised pension.
ii. The second calculation to be carried
out is as follows. The pension, as had been fixed at the time of implementation
of the VI CPC recommendations, shall be multiplied by 2.57 to arrive at an
alternate value for the revised pension.
iii. Pensioners shall be entitled to the
higher of the two.
It is recognised that the fixation of the
pension as per the above formulation (i) above may take a little time since the
records of each pensioner will have to be checked to ascertain the number of
increments earned in the retiring level. It is, therefore, recommended that in
the first instance the pension, may be fixed in terms of formulation (ii)
above, till final fixation of the pension under the Seventh CPC matrix is
undertaken.
10.2.88. Illustration
on fixation of pension for defence forces personnel based on recommendations of
the Seventh CPC
Case
I
10.2.89. Pensioner ‘A’ retired at last pay ₹46,310 in PB-4 with GP 8700 on 31
March, 2006 under the VI CPC regime, having drawn one increment in the V CPC
pay scale ₹15,100-450-17,350.
|
|
Amount
in ₹
|
1
|
Basic Pension fixed in VI CPC
|
30,505
|
2
|
Initial Pension fixed under Seventh CPC (using a
multiple of 2.57)
|
78,398
Option 1
|
3
|
Minimum of the corresponding pay level in 7 CPC
|
1,25,500
|
4
|
Notional Pay fixation based on one increment
|
1,29,300
|
5
|
Notional Pay after adding Military Service Pay
of ₹15,500
|
1,44,800
|
6
|
50 percent of the notional pay in pay level so
arrived and Military Service Pay
|
72,400
Option 2
|
7
|
Pension amount admissible (higher of Option 1
and 2)
|
78,398
|
Case
II
10.2.90. Pensioner ‘B’ retired at last pay ₹13,100 in GP 2800 on 31 May, 2015
under the VI CPC regime, having drawn two increments in PB-1.
|
|
Amount
in ₹
|
1
|
Basic Pension fixed in VI CPC
|
8950
|
2
|
Initial Pension fixed under Seventh CPC (using a
multiple of 2.57)
|
23,002
Option 1
|
3
|
Minimum of the corresponding pay level in 7 CPC
|
35,400
|
4
|
Notional Pay fixation based on 2 increments
|
37, 600
|
5
|
Notional Pay after adding Military Service Pay
of ₹5,200
|
42, 800
|
6
|
50 percent of the notional pay in pay level so
arrived and Military Service Pay
|
21,400
Option 2
|
7
|
Pension amount admissible (higher of Option 1
and 2)
|
23, 002
|
Sir, I retired as Hav (Group-Y) on 01 Dec 1997 with 16 yrs service in the 5th CPC regime. I earned 9 increments in the rank of Hav before retirement. Can I exercise Option 2. Kindly guide me. Thanks.
ReplyDeleteSir, you will have to wait for SAI 1/S/2016 because what is re-reproduced are contents of the Report of 7 CPC. These are just recommendations and the SAI will depend on GoI approval or otherwise of the 7 CPC recommendations.
DeleteA pre 2006 retired Lt Col with say 21 years service will then be entitled to 7 increments as the current Lt Cols are time scale at 13 years service. ??
ReplyDeleteSir, please see reply to the query of @jinjon above except that SAI 2/S/2016 will be applicable for Officers (based on which the Pension orders will flow.)
DeletePara 10.2.83(d) shd be revised. All bfor 1.9.08 the condition of 33 yrs for full pension remains. The Para gives this date as 1.1.06. You may like to clarify. Myself retd on 30.6.06 and had to fulfil 33 yrs reqt which incl rk weightage. As per your contention in one of your earlier posts annual equalisation was not so imp. In Lt of 7cpc, it has failed to specifically mention that equalisation of pensioners at 2023 levels will b the pension which will b used to derive our new pension as on 1.1.16. Annual equalisation would make the CPC irrelevant to us. We would have certainly gained. Eg a Brig pension if both orop and 7cpc are effected is likely to be 101000~. A brig retiring in Jan 16 will have a pension of 110000~.By the time of next equalisation ,a brig with three increments in 7cpc would further widen this gap.
ReplyDeleteSir, though I do not provide replies to individual queries (mujhe kitna milega or kyun itna hi), please provide rank at the time of retirement and the Pay in the Pay Band, Grade Pay and also what was fixed as your Basic pension. I will try to set your doubts at rest, provisionally.
DeleteYou have given 2023 levels? Misquote for 2013? By the way isn't OROP to bring pre-2006 pensioners to the 2006 levels? And you superannuated in 2006 and so are OROP compliant. Therefore what increments do you expect because increments are for additional years of effective service.
But the finality will only be when the SAI 2/S/2016 and relevant Pension orders are issued.
@batsy, Case I is for an officer retiring on 31.3.2006. Might be of interest for you.
DeleteOn what scale would be the pension of pre 2006 Maj with 33years service with weightage including 19 years commissioned service fixed as per 7thCPC
ReplyDeleteFor the sake of facts, no opinion/calculations etc will be offered till relevant Govt approval of 7 CPC recommendations and SAI/SNI/SAFI are issued.
ReplyDeleteThank you.
7 CPC is offering NPS for Defence personal as a choice? If we fall in trap, Gratuity is gone because that is being linked to the rules governing providential fund. For NPS subscriber neither Fin ministry nor PFRDA has made any rule since last 12 years. All govt. Bounty is for old system of pensioners and no one is ready to look into the plight of NPS subscribers who joined govt service after 2004. As. Such. Even though it is being declared in parliament that the Gratuity will be available to NPS fellows, no rules are made till date. It is big suspense.
ReplyDelete@Col MS Raju: From what I'd understood, one 7 CPC pension calculation for a pre Jan 2006 Lt Col with 25 years of service would be 25470x2.57=65457.90. For a Lt Col retiree of the period 01 Jan 2006 to 31 Dec 2015, it would be ( actual pension fixed)x2.57. I don't think MSP enters that equation.
ReplyDeleteAs per the matrix, if a Lt Col retiree of pre Jan 2016 category, promoted at 17 years of service with 25 years of service at retirement had earned 8 (25-17=8) increments, his pension would be (143500+15500)/2 =79500.
However, considering that to attain 25 years of service, an officer would require12, ie.12=25-13, increments and not the 8 actually earned in the pre AVS-I era, then his pension as per the matrix would need to be , ought to be, (161500+15500)/2= 88500.
However, I'd be grateful for any corrections regarding these speculations.
I retired on 1-10-1977 as Nb sub after put in 21-1/2 years service. What will be my basic pension in 7th CPC. Off course recommended.
ReplyDeleteSir, I ex jao iaf took discharge after 15 years of service on Feb 1991. Now my basic pension is 6971.00, is it correct one as on Jan 2016 ? Pls let me know the correct amount what should be at present, and after Orop and 7cpc ( basic only)
ReplyDeleteConsidering the well defined structure of the rigid pyramid of military only three parameters are need to be considered for the fixation of pensions 1. Rank 2. length of service and grade. and a compensation for retiring from the service depending on the difference of age between the civilian counter part. Either te civilian counter part is ignorant about tit or they are purposely ignore it for their supremacy. My earnest request to the bureaucrat is that they should not drag our well discipline soldier the same way the civilians demand their demands. Civilian always turned against the government at any time as strike and other kind of agitations. It will not effect the functioning of the government compare to such agitation from the forces. It is sensitive area and the government should give legitimate copensation for their contribution to safeguard our nation from external aggression and other disturbances from outside. I hope the top brasses will represent the case strongly and keep the rank and file under strict discipline and elevate their morale to the required level. Now a days soldiers are not fighting with swords. They are operators of sophisticated equipment and need more dexterity to use it effectively when needed. Some where I read that the soldiers are described as 'TOOL HANDLERS'. If so, who operate these equipment? and where they stand in the file? I feel sorry for our soldiers who sacrifice their life for the nation.
ReplyDeleteRegarding "Linkage of full pension with 33yrs of QS has been removed from 01-01-2006 for commisioned officers"There is no order yet from DESW for its implementation.
ReplyDeleteThis comment has been removed by the author.
ReplyDeleteThis comment has been removed by the author.
ReplyDeleteSir for sgt Gp X 7cpc BP awarded was RS
ReplyDelete4277 and brought up to lower rank Rs5519.eventually BP was increased to
8585 through OROP.what will the calculation for 7cpc 4277 or 8585 X2.57