Report of the Third Pay Commission Vol III - Personnel Below Officer Ranks

Report Of The Third Central Pay Commission Volume-III

Please note as you read and remember the impression conveyed that Pensions of PBOR were reduced from 70% to 50% by 3 CPC and co-relate with facts below.

Chapter 53

II – Personnel Below Officer Rank

37.     The periods of engagement now prescribed for persons enrolled as combatants in the Services, the length of service with the colours and in reserve, and the age limits for retirement are indicated in the table below:

  

TABLE XIII

Service	Ranks	Periods of engagement		Age limits or service limits for retirement
		Service with colours	Service in reserve
Army	Sepoys – Fighting Arms & Services	10 years	5 years	38 years of age
	Mechanics	12 years	3 years	43 years of age
	Minor Tradesmen	18 years	Nil	43 years of age
	Naik	-	-	20 years service
	Havildar	-	-	22 years service
	Naib Subedar	-	-	24 years service of 50 years of age
	Subedar	-	-	28 years service or 50 years of age
	Subedar Major	-	-	32 years service or 50 years of age or 4 years tenure
Navy	Sailors
	Seaman	10 years (initial extended by 5 years and thereafter till the age of retirement		41 years
	Leading Seaman			45 years
	Petty Officer, Chief Petty Officer			50 years
	Master Chief Petty Officer			55 years
Air Force	Airmen	15 years (initial) extended by 5 years and thereafter by 3 years till age of retirement		55 years

38.    The AFPRC had broadly followed the civil pension rules in making recommendations on pensions for personnel below officer rank, without providing any compensatory element in pensions for early termination of career. However, they allowed the full benefit of the civil pension formula to only those Servicemen who were able to complete 25 years or more of colour service. Thus, while they suggested the minimum period of 15 years colour service for earning pensions, the minimum pension was calculated on the basis of 13/60 of emoluments and 15/60. This depression was removed on the recommendations of the Kamath Committee in 1968. Since then, the only change that has taken place is the provision, in September 1970, of the DCR Gratuity on the civilian pattern for the personnel below officer rank also. After the provision o DCR Gratuity, the pension rates have been reduced by 11% to partially offset the cost of providing the DCR Gratuity. The emoluments for calculating pensions comprise basic pay and other items reckonable as pay, e.g. good service pay, as also the notional value of the home saving element which varies according to rank. The pension amounts have, however, been worked for each rank in the various pay groups for different lengths of colour service and not separately for individual Servicemen. The Serviceman is entitled to the pension of the rank held by him for at least two years prior to the date of retirement whether in acting or a substantive capacity, but marginal shortages in the qualifying service or in the rank can be condoned.        

39.    A fundamental change proposed by the Services is that the minimum period of qualifying service for earning pension should be reduced from 15 to 10 years in the case of personnel below officer rank. We feel that entitlement to pension should follow a fairly long period of service. As it is, the entitlement to pension after only 15 years service, for the military is a substantial concession as compared with the position appertaining to civilians and we would not suggest any reductions in this period for the former. 

Retiring pensions

40.    Arguing on more or less the same lines as in the case of officers, the Services have suggested that the rate of earning pensions in the case of personnel below officer rank should be 1/76 of the emoluments because of the lower order of deduction made in the amount of pension consequent upon provision of the DCR Gratuity. The Services have also suggested that a compensatory element of 20% of pension should be added in the case of Servicemen retiring within 15 years or less of service and that this percentage should be gradually decreased to Nil for servicemen retiring after 30 years of qualifying service. We have already discussed this question at some length in the case of service officers. We feel that the formula suggested by the Services is complicated na does not strike the most appropriate balance between the genuine needs of the Servicemen, and the responsibilities devolving on the  Government for the welfare of released Servicemen. In the case o servicemen retiring around the age of 35 to 40 years, the pension should not be viewed as their sole means of livelihood, because at this age the released Servicemen can be reasonably expected to be gainfully occupied and independently earning their living. In many cases, Servicemen are able to learn trades and acquire qualifications which stand them in good stead in securing civilian jobs in trade and industry. In many cases, proficient tradesmen leave service at the first opportunity in order to secure more lucrative civilian employment. Thus, the problems of transition to civilian life are not significant in the case of several categories of Service tradesmen.       

41.     Even so, the number of Servicemen who require assistance for resettlement on release from the Armed Force is fairly large and effective administrative arrangements have to be devised for that purpose. While resettlement on agricultural land continues to be popular with the ex-Servicemen, the scope for doing so is becoming more and more limited. According to the Ministry of Defence, several schemes have been started to impart training in various trades, both in the engineering and non-engineering fields. For this purpose, the help of Industrial Training Institutes in the various States is being sought. Various percentages of Government jobs continued to be reserved for released ex-Servicemen and special schemes are being taken up for the rehabilitation of war widows and war-disabled Servicemen. We are of the view that owing to the similarity in functions and training between forces such as the Central Reserve Police, Border Security Force, Railway Protection Force, and the Central Industrial Security Force on the one hand, and the Armed Forces on the other, more and more released Servicemen should be absorbed in suitable jobs in these forces. Such an arrangement would provide a continuing outlet for the released personnel of the armed forces, and would eliminate unnecessary training, and simultaneously increase the effectiveness of these para-military formations. The overall responsibility for ensuring proper implementation of all these measures rests with the Director General of Resettlement. The Armed Forces may also explore the possibility of utilising some of the released personnel from Fighting Arms in the various support services and technical wings, after necessary initial training and re-orientation. The periods of engagement in these other formations are longer, and the suggested internal re-adjustments may lessen the impact on the civilian labour market, making it easier to absorb those residual categories that the Armed Forces have perforce to release. In a system based on voluntary enlistment, the manner in which the Armed Forces personnel are treated on their retirement is an important factor influencing the attractiveness of the Services, and ensuring a regular flow of recruits of the right type. We would like to emphasise that the resettlement of ex-servicemen and rehabilitation of disabled personnel should be viewed as an important responsibility of the State and the community as a whole.      

42.    We have made these observations because we wish to emphasise the more positive aspect of the rehabilitation and resettlement of ex-Servicemen as opposed to the passive role that pensions play. As we have remarked in the case of officers, the Government should encourage ex-Servicemen to be self-reliant, useful and productive members of the community other than mere pensioners, It cannot be……(indecipherable) that a regular pension, even….. (indecipherable) help both as an insurance against unemployment and misfortune and as a supplementary source of income. We now proceed to determine how it should be quantified. 

43.    After detailed consideration, we have reached the conclusion that the right course would be to adopt the same approach for determining the pensions of personnel below officer rank as we have commended in relation to Service officers, viz., adding a weightage of 5 years to the prescribed length of qualifying service, subject to the total length of service reckonable for pension not exceeding 33 years, and applying the formula of 1/80 of emoluments as on the civil side for calculating the pension amount in conjunction with DCR Gratuity. We also proposed that the maximum of the pay scale prescribed for various ranks should be taken into account for calculating the pension of the rank. The addition of 5 years in cases where the period of qualifying service prescribed for earning pension of the rank is less than 20 years is a substantial benefit, which, we feel, provides adequate compensation for the liability to recall and the problems occasioned by early release from the Services, such as the transition from military to civil life, and the attendant uncertainty about securing suitable civil employment. We would again emphasise that the Government’s efforts should be viewed as a whole, and the adequacy of the 5 years weightage should be judged in the light of the package of other measures for the resettlement of released personnel from the Armed Forces.      

44.    As for the emoluments to be taken into account for the purpose of determining pension, the existing practice is to include basic pay, rank pay, increments of pay, good service pay, dearness pay and the notional home saving element. With the introduction of the revised scales, rank pay and dearness pay will cease to exist. Basic pay is taken as the maximum of the scale except that in the case of Army personnel below JCO rank, the basic pay is taken as the mean of the lowest and the highest class of the concerned pay group. We suggest that for purposes of pension, the emoluments in the case of the personnel below officer rank should include the maximum of the pay scale of the rank on the concerned pay group and the notional amount of the home saving element. In regard to good service pay, we feel that the right approach would be to include two rates i.e. Rs 8 in the case of Naiks and three rates i.e Rs 12 in the case of Havildars. In the other two Services, one rate i.e. Rs 10 for Leading Seamen and Corporals and three rates for Petty Officers and Sergeants and above should be included in the emoluments reckoned for pension. In the Army, personnel below JCO rank also have the opportunity of earning additional pay on improving their class in the pay group to which they belong. In line with the existing practice, we recommend that half the maximum amount that can ve earned by a serviceman in the form of class pay in his pay group should also be included in the emoluments reckoned for pension.  

45.    As regards the notional amount of the home saving element that should be reckoned as pay determining pensions, we feel that the existing amounts laid down for this purpose should be increase in line with the improvements in pay scales and the principles adopted for calculating the home saving element. On this broad basis and keeping in view the existing differentials in this respect as between the different ranks, we recommend that the notional amount of home saving element counted for pension should be revised as under: -  

Rank	Existing amount	Proposed revised amount
Sepoy	30	47.25
Naik	30	50
Havildar	35	55
Naib Subedar	50	70
Subedar	60	80
Subedar Major	65	85

Based on these recommendations, Government should determine the standard rates of pension rank-wise and for different lengths of colour service.

Death-cum-Retirement Gratuity

46.    Our recommendations made in Chapter 60 in regard to the civilian employees should also apply to the provision of DCR Gratuity for the personnel below officer rank.

Service Gratuity (Retiring Gratuity)

47.    Service gratuity at the rate of one month’s pay for each completed year of service is admissible to personnel below officer rank who are discharged after 5 years of more but less than 15 years of qualifying service. Where DCR Gratuity is payable the amount of service gratuity is reduced at the rate of 1/8 of a month’s pay for each completed six-monthly period of qualifying service beyond 4 years. Individuals discharged as their request on compassionate grounds or for other reasons are eligible to claim 75% of the normal entitlement and 25% of normal entitlement respectively.

48.    The Services have asked for the continuance of this gratuity and have proposed that in the case of voluntary retirement, no deduction should be made, as discharge is given only on genuine grounds with the approval of the competent authority. We feel that such liberalisation will encourage requests for discharge on voluntary retirement, and will not be in the public interest. We do not recommend any change in the existing provisions.  

Special Pension or Gratuity

49.    A special pension or gratuity is admissible to Servicemen who are not transferred to the reserves and are straightway discharged in large numbers in pursuance of a policy decision by the Government, on demobilisation or consequent on reorganisation and the disbandment of units. At present, proportionate pension is admissible to those discharged after service of 10 years or more but less than 15 years. For service below 10 years, gratuity is payable as under: -  

(i) Less than 5 years – 3 months pay

(ii) 5 years or more but less than 10 years – 1 1/3 of a month’s pay for each year subject to a reduction for death-cum-retirement gratuity.

50.    The Services have proposed that the scale of special gratuity should be one month’s pay for every half-year’s completed service subject to a minimum of six months pay. We find that the existing provisions are more favourable than those applicable to temporary Government servants on the civil side and do not, therefore, require any change at present. Further, occasions requiring the application of these provisions are not likely to arise in the near future and the rates can be reviewed on merits according to the circumstances prevailing at that time.

Reservist Fee and Pension

51.     During the period of reserve liability, the personnel below officer rank are entitled to a retaining fee of Rs 20 per month in addition to the pension granted, if any. Sepoys who are released from the Army after 10 years’ colour service get only a retaining fee of Rs 20 per month as they do not earn any pension, but on completion of 10 years’ colour service and 5 years’ reserve service, they are entitled to a reservist pension of Rs 30 per month.  

52.    The Service have proposed that the retaining fee should be enhanced from Rs 20 per month to Rs 30 per month. They have also proposed that 50% of reserve service should be treated as qualifying service for grant of Service pension and that the minimum pension of Rs 40 should also be extended to the reservists. We feel that the reserve service is a contingent liability and it would not be proper to count the period so spent in any fixed proportion for the purpose of calculating pension. We also find that after the recent ad hoc increase made in 1968, the amount of reservist pension exceeds the amount of the reservist fee. The position appears somewhat anomalous in that a reservist in such cases gets less during the period when he is liable to recall, than what he he would get by way of reservist pension after he had been absolved of this liability. In these circumstances, we do not recommend any change in so far as the amount of reservist pension is concerned. As regards the amount of the reservist fee, we feel that there is little justification for enhancing the resent rate for those Servicemen who are in receipt of pension because of the improvements recommended by us in the pension rates. There is a case, however, for enhancing the amount of the reservist fee in case of those Servicemen placed in the reserves before they have been liable to earn pension, and for them we recommend the payment of Rs 10 p.m in addition to the existing reservist fee of Rs 20 p.m. This will also ensure that the reservist fee for such Servicemen would be equal to the reservist pension as was the case for some years prior to 1967.    

Disability Pension

53.     The conditions attaching to the grant of disability pension are broadly the same for personnel below officer rank as for Service officers. Below the officer level, the service element equals the retiring pension if the Serviceman has rendered at least 15 years service; otherwise it is such proportion of the Service pension as the length of service bears to 15 years, subject to the minimum of tw-thirds of that pension. The services have not suggested any change in regard to the service element, but they have suggested a 50% increase in the rates of disability lement prescribed for the different ranks. We find that the rates of disability element for 100% disablement in case of personnel below officer rank vary with each rank from Rs 35 for a Sepoy to Rs 105 for the Subedar major to Rs 142.50 for Honorary Commissioned Officers. This differs from the system followed in regard to officers in whose cases the disability element does not vary with rank. Although it will not be practical to prescribe the same amount as disability element for all ranks below the officer level, we feel that within a broad group, the amount on this account should not vary. On this basis, and keeping in view the increase proposed in the case of Service officers, we recommend the following revised rates for the disability element for 100% disablement: -

        

TABLE XIV

Rank	Existing disability element for 100% disability (Rs p.m)	Proposed rate (Rs p.m)
Honorary Commissioned Officers	142.50	170
Subedar Major	105.00	110
Subedar	90.00
Naib Subedar	65
Havildar	48.oo	60
Naik	40.00
Sepoy	35.00	45

As in the case of Service officers personnel below officer rank are entitled to only the invalid pensionary awards in case the degree of disability attributable to service is less than 20%. In the case of personnel below officer rank also, the Services have asked for at least the service element of the disability pension to be allowed in such cases. We accept the proposal and recommend accordingly.

Constant Attendance Allowance

54.    Servicemen invalided out of service for 100% disablement attributable to military service are entitled to a constant attendance allowance of Rs 35 per month subject to a certificate being issued by the competent medical authority. The Services have proposed that the amount of this allowance should be increased to Rs 50 per month. We recommend that the rate of this allowance should be enhanced to Rs 45 per month.

Invalid Pension

55.     Personnel below officer rank invalided out of service on account of cause which are not attributable to service are entitled to invalid pension as under:

Length of service	Entitlement
15 years or more	Normal service pension
10 years or more, but less than 15 years	Proportionate pension
Less than 10 years	Gratuity at one month’s pay for each year of service

The existing provisions seem to be satisfactory and we recommend no change.

Family Pension Awards

56.    In regard to special family pension as also the ordinary family pension, the personnel below officer rank are governed by civilian rules, viz., the Extraordinary Family Pension Scheme and the Ordinary Family Pension scheme. Our recommendations in this regard in Chapter 60 on Retirement Benefits pertaining to civilian employees should also apply to the personnel below officer rank.

Battle Casualties

57.     We have not made any recommendations with regard to the special family pensionary awards admissible to the families of officers and personnel below officer rank in the case of battle casualties and casualties in certain specified operations. We have looked into the liberalised pensionary awards for war widows and war-disabled servicemen and the concessions to the children of officers and men of the Armed Forces killed or disabled during war, war skirmishes or in fighting against armed hostiles in specified operations. In view of the recent liberalisations, as also the awards and benefits announced by the various State Governments, we have not considered it necessary to make any recommendations in this regard. The Services have also not recommended any change in the existing entitlements.