Seventh CPC: How the package for Armed forces was worked out

While making recommendations for Armed forces the CPC had held consultations with the Ministry of Defence, the Defence Services, the Department of Ex-Servicemen Welfare, the Controller General of Defence Accounts. It has taken note of the demand from The Defence Services, in their Joint Services Memorandum, that the emoluments in the Defence Services should stand a fair comparison with the emoluments in Civil Services, in order to ensure  legitimate share of the available talent pool. The CPC also commissioned a study with the Institute for Defence Studies and Analyses (IDSA) as an independent expert agency dedicated to research and policy in defence and security on “Nature, Quantum and Components of Defence Expenditure and Defence Pensions. The study covered pattern of defence expenditure in India (1995-96 to 2013-14) and other important countries.

Comparing the defence expenditure as a percentage of GDP it was noted that Defence Expenditure as a percentage of GDP has declined from 2.19 percent in 1995- 96 to 1.80 percent in 2012-13. Also as a percentage of Central Government expenditure it has declined from 14.50 percent in 1995-96 to 12.89 percent in 2012-13. However Defence capital expenditure as a percentage of total defence expenditure has shown an increase from around 25 percent in later half of the 1990s to over 40 percent in the recent years.

The report indicated that considering  expenditure on procurement and infrastructure as percentage of defence expenditure India ranks at the first place among the ten countries covered by the study. Unlike some European countries Russia, India (from 27.55 percent in 2007 to 41.12 percent in 2012), and Pakistan witnessed the sharpest increase in share of expenditure on personnel as a percentage of defence expenditure between 2007 and 2012. The hike has been explained by the fact that Indian Armed forces are labour intensive and the increase in pay scales by VIth CPC is the major influencing factor.The Commission has stated that it has tried to strike a balance between capital and revenue expenses for the defence forces.

Besides ensuring pay structure comparable to Civil Services the CPC has also attempted to compensate for the hardships involved in Military Service by recommending continuation of Military Service Pay upto rank of Brigadier and equivalent and other allowances to compensate for risk and hardship borne by defence service personnel.It has also recommended a  defined benefit pension scheme, which entails no contribution as distinct from a defined contribution scheme which entails a monthly contribution by each official as applies to all other Central Government personnel.

The Commission has asserted that the Military Service Pay, which is a compensation for the various aspects of role performed by Armed Forces and has historically provided the edge to the Defence Forces over the civilian scales,  will be admissible to the Defence Forces personnel only. The Commission has reiterated that  the intangible aspects linked to the special conditions of military service set the Armed Forces apart from civilian employees.

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Seventh CPC :Army and MNS Recommendations

The recommendations for Armed Forces are based on approach similar to that adopted for civilian employees as spelt out in previous posts.The  Pay Bands and Grade pay have been done away and fitment factor of 2.57 has been applied to all categories.The entry pay to a category (except for MNS) is arrived at by calculating minimum of pay band and accounting for subsequent increments earned in the pay band (except for the rank of Brigadier where fitment table notified by the Ministry of Defence through its Special Army Instructions of October 2008.)

Like civilian pay scales the Commission has, for deciding entry pay at various stages, proposed index of rationalisation to account for higher degrees of responsibility and accountability at various levels .While this is  fixed as 2.57 for PB  -1 it rises  steadily climbing to to 2.81 for Service Chiefs .Index of 2.57 applies also to the officers in the rank of Colonel and Brigadier and their equivalent.

The starting pay in existing pay structure is ₹8,460 Sepoy (and equivalent), Under the recommendations the pay of entry level personnel in the defence forces, has been fixed in the Defence Pay Matrix at ₹21,700. Fixation of pay will follow the same principle as that for a regular promotion in the pay matrix.

The Commission has not recommended any increase in the number of MACPs. which is presently pegged at 8, 16 and 24 years .

The Commission has maintained pay parity in civilian and defence personnel at matching levels .Group `A’ entry level is identical at ₹56,100 in the case of both civilian and defence service officers. Similarly the pay of the Major General and Joint Secretary and equivalent officers and those above [viz., Lieutenant General (in HAG, HAG+, Apex) and Chief of each defence service] has been kept identical with their civilian counterparts. Identical pay levels has been devised for JCO/ORs and their civilian counterparts corresponding to the existing pay bands and grade pay.

For defence forces personnel, there are two separate matrices, one for the Service Officers and JCO/ORs and another for the Military Nursing Officers. The Pay Matrix designed for the Defence Forces personnel is more compact than the Civil pay matrix keeping in view the number of levels, age and retirement profile of the service personnel.

Defence Pay Matrix

The Commission has further clarified that the pay structure designed by it for the defence forces personnel has been done keeping in view (a) some of the aspects in their rank structure unique to them and (b) pay structure is not intended to determine the status of the personnel vis-à-vis their counterparts on the civil side.

In the design of the Pay Matrix for Military Nursing Service (MNS) , the Commission has kept in view the approach followed by previous Pay Commissions and traditional relativities between the Armed Forces Officers and Military Nursing Service Officers. In particular the pay scales/grade pay based on the V and VI CPC Reports were kept in view.

While deciding the level of minimum pay fro MNS the following formula has been adopted:Minimum Pay for a Rank in MNS= (Minimum Pay for that Rank in Defence Pay Matrix) x (Grade Pay of the Rank in MNS)/(Grade Pay of that Rank in the Services).The pay Matrix for MNS thus conceived is as below :

Pay MAtrix MNS

Following exceptions have  been made for purposes of rationalising the pay structure:

  1. In the case of Captains, the Commission has moderated the minimum pay level upwards to ₹59,00017, to avoid bunching of minimum pay of MNS Lieutenant and Captain.

  2. In the case of Brigadiers some moderation downwards from the figure arrived at by the formula (₹1,26,800) has been effected to provide suitable differential in the minimum of the pay level between Brigadier and Major General of MNS. Hence the mid-point of the minimum of the pay levels of Colonel and Major General viz., ₹1,19,700 has been taken as the minimum pay for the Brigadier of MNS.

For Military Service Pay the Commission has recommended an MSP for the four categories of Defence forces personnel at ₹15,500 for the Service Officers, ₹10,800 for Nursing Officers, ₹5,200 for JCO/ORs, and ₹3,600 for Non Combatants (Enrolled) in the Air Force per month. MSP will continue to be reckoned as Basic Pay for purposes of Dearness Allowance, as also in the computation of pension but will  not be counted for purposes of House Rent Allowance, Composite Transfer Grant and Annual Increment.

For calculations in individual cases the procedure as outlined in previous post can be followed.The Report of CPC is also included in this blog on the “REPORTS” pages.In case of difficulty in viewing the pay matrix  original can be viewed on page 89 & 91 of the report.

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