Government announced hike in the Military Service Pay (MSP) and One Rank One Pension (OROP) issue resolved

Government announced hike in the Military Service Pay (MSP) and One Rank One Pension (OROP) issue resolved

Our Soldiers Protect Our Borders in Tough Conditions - FM

The issue of One Rank One Pension (OROP) has been resolved and the Government also announced substantial hike in the Military Service Pay (MSP) of all service personnel and special allowances given to Naval and Air Force personnel deployed in high risk duties.

Ministry of Finance

Defence budget hiked to Rs. 3,05,296 crore

Rs. 3,05,296 crore have been provided in the Budget Estimates for 2019-20, compared to Rs. 2,82,733 crore provided in 2018-19 Budget Estimates. The figures were revised to Rs. 2,85,423 crore in the Revised Estimates of 2018-19. While presenting the Interim Budget 2019-20 in Parliament today the Union Minister for Finance, Corporate Affairs, Railways and Coal Sh. Piyush Goyal said "Our Defence Budget will be crossing Rs.3,00,000 crore for the first time in 2019-20. For securing our borders and to maintain preparedness of the highest order, if necessary, additional funds would be provided."

On the issue of strengthening Defence and National Security, the Interim Budget 2019-20 states that our soldiers protect our borders in tough conditions and they are our pride and honour. The Finance Minister Sh. Goyal said that due care has been taken of their honour. He said that the issue of One Rank One Pension (OROP) which was pending for the last forty years has been resolved.
He said "The previous Governments announced it in three budgets but sanctioned a mere Rs.500 crore in 2014-15 Interim Budget; in contrast we have already disbursed over Rs.35,000 crore after implementing the Scheme in its' true spirit. The Government also announced substantial hike in the Military Service Pay (MSP) of all service personnel and special allowances given to Naval and Air Force personnel deployed in high risk duties."

Source: PIB

Allowance to Armed Forces

Ministry of Defence
Allowance to Armed Forces

31 DEC 2018

Taking note of the rigours of military life, the 6th Central Pay Commission (CPC) had recommended an additional, separate element of Pay for the Defence Forces called Military Service Pay (MSP) which the CPC intended would also maintain the edge enjoyed by the Defence Forces over the civilian scales. The Commission was of the view that the rate of MSP as a percentage of the existing pay has to be maintained in case of officers (up to the level of Brigadier / equivalent) as well as PBORs because the difficulties faced in field situations by both these categories are similar.

The 7th Central Pay Commission (CPC) had considered all aspects with regard to applicability of MSP including the rates while making its recommendations. This was done after considering the views of the Services in the matter. The 7th CPC has consciously decided not to create additional categories of personnel for the grant of MSP or to disturb the slab rates for the four categories for which it is being paid up to the level of Brigadiers. The Government after carefully considering the recommendations of the 7th CPC in respect of MSP has accepted and notified the same.

Besides MSP, Service personnel are entitled to several other allowances such as High Altitude Allowance, Field Area / Modified Field Area Allowance, Counter Insurgency Allowance etc which are paid based on risks and hardships involved at a location / in an operation.

Engine-wise capacity and interval in years allowed as regards vehicle PURCHASE for officers and jawans:

Eligibility
S. No.	Category	CC	Periodicity
(a)	Officers (including Retd / Widows)	3000	Once in Four Years.
(b)	JCOs granted Honorary Commission & Equivalent (including Retd & Widows)	2500	Once in Seven Years.
(c)	JCOs & Equivalent(including Retd & Widows)	2000	Once in Service and Once after Retirement. First Car after ten years of Service. Gap between purchases of Two Cars to be Ten years. If the late husband had purchased a car each while in service / after retirement then the widow will not be eligible to buy a car. In case late husband had purchased only one car then widow can buy one car through CSD after gap of 10 years from the date of last purchase.
(d)	OR & Equivalent(including Retd & Widows)	1800	Once in Service and Once after Retirement. First Car after ten years of Service. Gap between purchases of Two Cars to be Ten years. If the late husband had purchased a car each while in service / after retirement then the widow will not be eligible to buy a car. In case late husband had purchased only one car then widow can buy one car through CSD after gap of 10 years from the date of last purchase.

This information was given by Raksha Rajya Mantri Dr. Subhash Bhamre in a written reply to Shri Vishambhar Prasad Nishad and others in Rajya Sabha today.

PIB

Demand on Higher Military Service Pay (MSP) - Parliament Q&A MILITARY SERVICE PAY

Demand on Higher Military Service Pay (MSP) - Parliament Q&A MILITARY SERVICE PAY

In a written reply to a question regarding Military Service Pay in Parliament on 26.12.2018, the Minister of State for Defence Shri Subhash Bhamre said that the MSP was raised by the identical fitment of 2.57.

We reproduced the answer and given below for your information…

“Taking note of the rigours of military life, the VI Central Pay Commission (CPC) had recommended an additional, separate element of pay for the Defence Forces called Military Service Pay (MSP), which the CPC intended would also maintain the edge enjoyed by the Defence Forces over the civilian scales.

The VII CPC has consciously decided not to create additional categories of personnel for the grant of MSP or to disturb the slab rates for the four categories for which it is being paid up to the level of Brigadiers. This was done after considering the views of the Services in the matter. MSP was raised by the identical fitment of 2.57 which was applied for pay structure approved by the VI CPC. The recommendations of the VII CPC were accepted by the Government.
Government has recently approved a proposal to establish Armed Forces Special Operations Division which is designed as a tri Services organisation.”

High Court Direction on MSP

On 12th March 2018, question raised by a member in Parliament related to MSP. Whether Government is considering to grant Military Service Pay (MSP) equally to all ranks in the light of Hon’ble High Court’s direction in writ Petition No. 6607/2017 of ‘Voice of Ex- Servicemen Society’?
The concerned Minister replied as follows…

“Hon”ble Delhi High Court in its order dated 28th November, 2017 has not given any specific direction to grant Military Service Pay (MSP) equally to all ranks. It may be informed that the Hon’ble Court in its order mentioned that the conduct of the petitioners in withholding material information and at the same time, trying to invoke equities under Article 226 of the Constitution of India is deprecated.

The 7th Central Pay Commission (CPC) had considered all aspects with regard to applicability of MSP including the rates while making its recommendations. The Government after carefully considering the recommendations of the 7th CPC in respect of MSP has accepted the same and have already been notified.”

7th CPC Recommendation on MSP

7th CPC Report Para 5.2.22 says…

5.2.22 Military Service Pay (MSP): The defence forces personnel, in addition to their pay as per the Matrices above, will be entitled to payment of Military Service Pay for all ranks up to and inclusive of Brigadiers and their equivalents. The Commission recommends an MSP for the four categories of Defence forces personnel at Rs 15,500 for the Service Officers, Rs 10,800 for Nursing Officers, Rs 5,200 for JCO/ORs, and Rs 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. Military Service Pay will however not be counted for purposes of House Rent Allowance, Composite Transfer Grant and Annual Increment.

17.10 Military Service Pay (MSP): The Defence forces personnel will continue to be entitled to payment of Military Service Pay for all ranks up to and inclusive of Brigadiers and their equivalents. The MSP per month recommended is as follows:

i.	Service Officers	Rs 15,500
ii.	Nursing Officers	Rs10,800
iii.	JCO/ ORs	Rs 5,200
iv.	Non Combatants (Enrolled) in the Air Force	Rs 3,600

7th CPC Grant of Military Service Pay

Ministry of Defence

7th CPC Grant of Military Service Pay

12 MAR 2018

Delhi High Court in its order dated 28 November 2017 has not given any specific direction to grant Military Service Pay (MSP) equally to all ranks. It may be informed that the court in its order mentioned that the conduct of the petitioners in withholding material information and at the same time, trying to invoke equities under Article 226 of the Constitution of India is deprecated.
The 7thCentral Pay Commission (CPC) had considered all aspects with regard to applicability of MSP including the rates while making its recommendations. The Government after carefully considering the recommendations of the 7thCPC in respect of MSP has accepted the same and have already been notified.

This information was given by RakshaRajyaMantriDr. Subhash Bhamre in a written reply to Shri Mahendra Singh Mahrain Rajya Sabha today.

PIB

Fixation of Pay of re-employed pensioners - treatment of Military Service Pay (MSP)

Fixation of Pay of re-employed pensioners - treatment of Military Service Pay (MSP) - reg.

GOVERNMENT OF INDIA
MINISTRY OF RAILWAYS
RAILWAY BOARD

No.E(G) 2013/EM 1-5

New Delhi, dated 06, March 2017

The General Secretary,
National Federation of Indian Railwaymen.
3, Chelmsford Road,
New Delhi.

Sir.

Sub: Fixation of Pay of re-employed pensioners - treatment of Military Service Pay (MSP) - reg.

The undersigned is directed to refer to your letter No.II/35/Part XIII dated 10.01.2017 on the above subject and to state that the illustration given in your letter regarding treatment of Military Service Pay (MSP) while fixing the pay of ex-servicemen re-employed in the Railways has been examined in consultation with the Finance Directorate is not as per the instructions contained in DoP&T's OM No.3/19/2009 Estt. Pay II dated 08.11.2010 which was circulated to the Railways vide Board's letter No.E(G) 2013/EM 1-4 dated 24.07.2013 and reiterated vide Board's letter of even number dated 15.12.2016. The DoP&T’s OM only provides that the MSP part of pension will not be deducted from the pay fixed on re-employment. It does not provide for including MSP in the pay fixed on re-employment.

Yours faithfully,
sd/-
for Secretary/
Railway Board

Source: NFIR

Treatment of Military Service Pay(MSP) while fixing the pay of ex-servicemen re-employed on the Railways: Railway Board

Treatment of Military Service Pay(MSP) while fixing the pay of ex-servicemen re-employed on the Railways: Railway Board

GOVERNMENT OF INDIA
MINISTRY OF RAILWAYS
RAILWAY BOARD
No.E(G)2013/EM 1-5

New Delhi, dated 16/01/2017

The General Secretary,
N.F.I.R.,
3, Chelmsford Road,
New Delhi - 110055.

Dear Sir,

Sub:  Applicability of Railway Services (Revised Pay) Rules, 2008 for persons re-employed in Railway service after retirement from Defence Forces - reg.

The undersigned is directed to refer to NFIR's letter-(No.II/35/Pt. XIII dated 23/11/2016 on the above subject and to state that as decided in the meeting with representatives of NFIR in the meeting held in ED/IR's room on 27/9/2016, reference has been made to DOP&T for seeking clarification, duly incorporating the-views of NFIR (copy enclosed). Their reply in the matter is awaited despite a reminder dated 4/1/2017.

Instructions have also been issued to GMs/Zonal Railways, Production Units etc. vide letter [No. E(G)/2013/EM 1-5 dated 15/12/2016] (copy enclosed) for strictly complying with the instructions contained in Board's  letter No. E(G)2013/EM 1-4 dated 24/7/2013 regarding treatment of Military Service Pay (MSP) while fixing the pay of ex-servicemen re-employed on the Railways.

DA: As above

Yours faithfully,
sd/-
for Secretary Railway Board

Source: NFIR

MSP for Defence Personnel: Govt Decision on 7th CPC Recommendations

MSP for Defence Personnel: Govt Decision on 7th CPC Recommendations

STATEMENT SHOWING THE RECOMMENDATIONS OF THE VII CENTRAL PAY COMMISSION RELATED TO OFFICERS OF THE ARMED FORCES AND GOVERNMENT DECISION THEREON (FIGURES REFERRED IN PARENTHESIS PERTAINS TO CHAPTER AND PARAGRAPH OF THE PAY COMMISSION REPORT)

Sl. No.	Recommendations of the VII CPC	Decision of the Government
1.	Fitment Factor: The Seventh CPC has recommended fitment in the pay band in the following manner:- ‘The fitment in the new matrix is essentially a multiple factor of 2.57. This multiple is the ratio of the new minimum pay arrived at by the Commission and the existing minimum pay. The fitment factor is being applied uniformly to all employees. It includes a factor of 2.25 to account for DA neutralisation, assuming that the rate of Dearness Allowance would be 125 percent at the time of implementation of the new pay as on 01.01.2016. The actual raise/fitment being recommended by the Commission is 14.29 percent. An identical fitment of 2.57 has also been applied to the existing rates of Military Service Pay (MSP), applicable to Defence forces personnel only.’ (Para 5.2.7)	Minimum Pay, Fitment Factor, Index of Rationalisation, Pay Matrices and general recommendations on pay recommended by the Commission have been accepted without any material alteration with the following exceptions in Defence Pay Matrix, namely:- a) The Index of Rationalisation of Level 13A (Brigadier) in Defence Pay Matrix would be revised upward from 2.57 to 2.67. b) Additional 3 stages in Levels 12A (Lt. Col), 3 stages in Level 13 (Colonel) and 2 stages in Level 13A (Brigadier) would be added appropriately in the Defence Pay Matrix.
2.	Rate of increment: The rate of annual increment is being retained at 3 per cent. ( Para 5.1.38)	There would be two dates for grant of increment viz. 1 st January and 1st July of every year, instead of existing date of 1st July. However, an employee will be able to avail annual increment only on one of these two dates depending on the date of appointment, promotion or grant of financial upgradation.
3.	Military Service Pay for Officers: The Defence forces personnel, in addition to their pay as per the Matrices above, will be entitled to payment of Military Service Pay for all ranks up to and inclusive of Brigadiers and their equivalents. The Commission recommends an MSP for Defence forces personnel at Rs 15,500 for the Service Officers and Rs 10,800 for Nursing Officers. MSP will continue to be reckoned as Basic Pay for purposes of Dearness Allowance, as also in the computation of pension. Military Service Pay will however not be counted for purposes of House Rent Allowance, Composite Transfer Grant and Annual Increment.(Para No. 5.2.22)	Rate of Military Service Pay (MSP) is accepted. However, MSP will be counted only for Dearness Allowance (DA) and Pension.

Authority: www.egazette.nic.in
Click to view the 7th cpc notification for defence personnel

Taxable and Non-Taxable Elements of Pay and Allowances

Taxable and Non-Taxable Elements of Pay and Allowances

List of Taxable Elements of Pay

Taxable Element of Pay : Provisions are applicable equally for monthly payment of Allowances as well as arrears for the said head of Pay/Allowances.

Non-Taxable Elements of Pay : Salary for this purpose includes Pay in Pay Band + Grade Pay + MSP (w.e.f. 01 Sep 08) + DA + NPA (if any).

Sl. No.	Taxable Elements of Pay
1.	Pay in the Pay Band
2.	Grade Pay
3.	Military Service Pay
4.	Dearness Allowance
5.	Non-Practicing Allowance (if any)
6.	Hazard/Special Hazard Pay
7.	Para Allowance/Para Reserve Allowance/Special Commando Allowance
8.	City Compensatory Allowance
9.	Deputation (Duty) Allowance (If any)
10.	Reimbursement of Furniture
11.	Reimbursement of Water
12.	Reimbursement of Electricity
13.	Technical Allowance
14.	Qualification Pay
15.	Special Action Group Allowance (on posting to National Security Guard)
16.	Technical Pay
17.	Language Allowance
18.	Qualification Grant
19.	Language Award
20.	Flying Allowance
21.	Leave Encashment on LTC
22.	Specialist Allowance
23.	Test Pilot Allowance
24.	Instructor Allowance
25.	Flight Test Allowance
26.	Security Allowance
27.	Strategic Force Allowance

Sl No.	Non-Taxable element of Pay	Authority	Limit of Exemption
1.	Gallantary Award	A.O. 46/79;U/S 10 (18)(i) of IT Actsw.e.f. 1947	Fully Exempt
2.	Entertainment Allowance	U/S 16 (ii) of IT Act w.e.f.01/04/81	A sums equal to1/5th of salary(excluding any allowance/benefit) orRs.5000/- per annum whichever isless.
3.	Leave Travel Concession (LTC)	U/S 10 (5) of IT Act w.e.f.01/04/89	Actual Expenditure upto the limit of entitlement
4.	Foreign Allowance	U/S 10 (7) of IT Act	Fully Exempt
5.	Bhutan Compensatory Allowance (BCA)	AO 395/74and U/S 10(7) of IT Act	Fully Exempt
6.	Servant Wages Allowance along with BCA	AO 395/74 and U/S 10 (7) of IT Act	Fully Exempt
7.	Purchase of Crockery/Cutlery/Glassware	U/S 10 (7) of IT Act	Fully Exempt
8.	Outfit allowance on posting to Embassy	U/S 10 (7) of IT Act	Fully Exempt
9.	Arrears of Cash Grant – Foreign Allowance (Nepal)	U/S 10 (7) of IT Act	Fully Exempt
10.	Myanmar Allowance	U/S 10 (7) of IT Act	Fully Exempt
11.	Representation Grant for use of crockery set	U/S 10 (7) of Act	Fully Exempt
12.	Encashment of Leave on retirement whether on superannuation/voluntary retirement/release/invalidment etc.	U/S 10 (10AA) (i) of IT Act w.e.f. 01/04/78	Fully Exempt
13.	House Rent Allowance/House Rent Reimbursement (HRA/HRR)	U/S 10 (13A) of IT Act w.e.f. 06/10/1964; Limit of exemption as per Rule 2A of IT Rules	*Quantum of exemption is least of the following – a) For Bombay/Kolkata/Delhi Chennai i) Allowance actually received. ii) Rent paid in excess of 10% of salary iii) 50% of salary b) For other cities i) Allowance actually received. ii) Rent paid in excess of 10% of salary. iii) 40% of salary
14.	Children Education Allowance	U/S 10 (14) (ii) of IT Act and Rule 2BB (2) – Table Sl No.5 of the IT Rules	Rs.100/- per month per child upto a maximum of 2 children.
15.	Hostel Subsidy	U/S 10 (14) (ii) of IT Act and Rule	2BB (2) – Table Sl No.6 of the IT Rules, Rs.300/- per month per child upto a maximum of 2 children
16.	Siachen Allowance	U/S 10 (14) (ii) of IT Act and Rule 2BB (2) –Table Sl No.1 (II) of the IT Rules	Rs.7000/ per month w.e.f. 01/08/1997
17.	Special Compensatory (Remote Locality) Allowance	U/S 10 (14) (ii) of IT Act and Rule 2BB (2) – Table Sl.No.2 of the IT Rules	Category I – SCA ‘A’ – Rs.1300/- per month Category III – SCA ‘B’ – Rs.1050/- per month. Category IV – SCA ‘C’ – Rs.750/- per month. Category VI – SCA ‘D’ – Rs.200/- per month.
18.	Compensatory Field Area Allowance	(CFAA) U/S 10 (14) (ii) of IT Act and Rule	2BB (2) – Table Sl No.7 of the IT Rules Rs.2600/- per month w.e.f. 01/05/1999
19.	Compensatory Modified Field Area Allowance (CMFAA)	U/S 10 (14) (ii) of IT Act and Rule 2BB (2) – Table Sl No.8 of the IT Rules	Rs.1000/- per month w.e.f. 01/05/1999
20.	Any Special Allowance in the nature of Counter Insurgency Allowance (SCCIA)	U/S 10 (14) (ii) of IT Act and Rule 2BB (2) – Table Sl.No.9 of the IT Rules	Rs.3900/- per month w.e.f. 01/05/1999
21.	Transport Allowance granted to meet expenditure for the purpose of commuting between place of residence and duty	U/S 10 (14) (ii) of IT Act and Rule 2BB (2) – Table Sl.No.10 of the IT Rules	For whole of India – Rs.1600/- per month
22.	Transport Allowance granted to a blind or orthopedically handicapped employee with disability of lower extremities to meet expenditure for the purpose of commuting between place of residence and duty	U/S 10 (14) (ii) of IT Act and Rule	For Whole of India – Rs.3200/- per month 2BB (2) – Table Sl.No.11 of the IT Rules
23.	High Altitude Uncongenial Climate Allowance (HAUCA)	U/S 10 (14) (ii) of IT Act and Rule 2BB (2) Table Sl.No.13 of the IT Rules	For areas of (a)Altitude of 9000 to 15000 feet (HAUCA ‘I) – Rs.1060/- per month w.e.f. 01/05/1999. (b)Altitude above 15000 feet (HAUCA ‘II’ & ‘III) – Rs.1600/- per month w.e.f. 01/05/1999.
24.	Highly Active Field Area Allowance (HAFA)	U/S 10 (14) (ii) of IT Act and Rule 2BB (2) –Table Sl.No.14 of the IT Rules	Rs.4200/- per month
25.	Island (duty) Allowance granted to the members of Armed Forces	U/S 10 (14) (ii) of IT Act and Rule 2BB (2) – Table Sl.No.15 of the IT Rules.	For Andaman & Nicobar and Lakshadweep group of islands – Rs.3250/- per month inserted w.e.f. 29/02/2000.
26.	Outfit Allowance (Initial/Renewal)	U/S 10 (14) (i) of IT Act and Rule 2BB (1) (f) of IT Rules.	Fully Exempt
27.	Compensation for the change of uniform	U/S 10 (14) (i) of IT Act and Rule 2BB (1) (f) of the IT Rules	Fully Exempt
28	. Kit Maintenance Allowance	U/S 10 (14) (i) of IT Act and Rule 2 BB (1) (f) of the IT Rules	Fully Exempt
29.	Uniform Allowance (MNS)	U/S 10 (14) (i) of IT Act and Rule 2BB (1) (f) of the IT Rules	Fully Exempt
30.	Special Winter Uniform Allowance	U/S 10 (14) (i) of IT Act and Rule 2BB (1) (f) of the IT Rules	Fully Exempt
31.	Reimbursement of Medical Expenses	U/S 17 (2) (viii) (v) of IT Act	Actual expenditure upto Rs.15000/- per annum.
32.	Any payment from Provident Fund	U/S 10 (11) of IT Act	Fully Exempt
33.	Payment of Compensation – Disability Pension	CBDT F.No. 200/51/99- ITA1 dated 02 Jul 2001	Fully Exempt.

DISCLAIMER: The above provisions are with the understanding and interpretation of IT Act 1961/IT Rules as amended and instructions issued by CBDT from time to time. Rules, provisions, further amendments and clarifications are issued by IT department/CBDT only and this office does not have any role in framing the same except IT deductions at source with reference to them.

Authority: www.pcdaopune.gov.in

MHA for Pay on Par with Army for Paramilitary

In its presentation before the ECOS, the MHA also batted for a ‘special pay’ on par with the army. The defence forces get a special allowance in the form of military service pay (MSP) over and above their salaries.

MHA for Pay on Par with Army for Paramilitary – While recommending a ‘CAPF service pay’, the home ministry said, “CAPF fulfills all attributes required for military service pay, which includes separation from family.

Drawing a parallel with defense forces, Rajnath Singh-led home ministry, has recommended equivalent pay for a second in command (2IC) in central paramilitary to that of a lieutenant colonel in the army. At present, there is a difference of Rs 40,000 in their salaries “despite operational role of both ranks being similar in nature,” the home ministry informed the empowered committee of secretaries (E-COS) in its recent discussion.

In its presentation before the ECOS, the MHA also batted for a ‘special pay’ on par with the army. The defence forces get a special allowance in the form of military service pay (MSP) over and above their salaries.

While recommending a ‘CAPF service pay’, the home ministry said, “CAPF fulfills all attributes required for MSP, which includes separation from family.

They are the key pillars of internal and border guarding, handle warlike situation and continuously engaged in operations.”

According to an MHA official, the proposal for a ‘CAPF special pay’ was earlier mooted before the 7th pay commission last year. However, it was shelved at the last minute.

He also stated that the CAPF has raised nearly 40 demands, which were examined at the MHA, before recommending 11 of them to E-COS.

While terming it to be a “great morale booster” for the forces, the home ministry in its recommendation also sought additional leave travel concession (LTC) for CAPF personnel serving in high altitude on par with defense forces that will “facilitate personnel to visit at least twice to their families on government cost,” MHA said in its representation.

Home ministry also sought to address the problem of stagnation among the paramilitary by proposing that modified assured career progression scheme (MCAP). It shall be allowed four times at an interval of 8, 16, 24 and 32 instead of 3 times at an interval of 10, 20,30 years. “At present, it takes 20-22 years for them to get their first promotion and this has also led officers to quit. As many as 9,300 personnel quit ITBP, CISF, SSB BSF, CRPF, due to non-friendly working conditions,” said an official.

The government also advocated for a better leave structure for the personnel who are deployed for counter-insurgency operations across the country.

Source: Economic Times

Discrimination in Structure of Military Service Pay – Defence Minister Reply

Discrimination in Structure of Military Service Pay – Defence Minister Reply

Military Service Pay is paid as a compensation to the Armed Forces personnel as a recognition for the intangible aspects linked to the special conditions of their service.

Defence Minister has clarified about Military Service Pay (MSP) is being paid to the Armed Forces Personnel w.e.f. 1st September, 2008.

Press Information Bureau
Government of India
Ministry of Defence

15-March-2016

Discrimination in Structure of Giving MSP

Military Service Pay (MSP) is being paid to the Armed Forces Personnel w.e.f. 1st September, 2008. It is a compensation paid to the Armed Forces personnel as a recognition for the intangible aspects linked to the special conditions of their service. On recommendation of 6th Central Pay Commission, MSP was introduced for the first time in respect of Armed Forces.

The MSP being paid to Armed Forces Personnel is in two slabs:-

(i) For Officers – Rs.6,000 per month
(ii) For JCOs/OR – Rs.2,000 per month.

However, Government has separately provided a number of allowances based on risks and hardships involved at a location / in an operation, such as High Altitude Allowances, Field Area / Modified Area Allowances, Counter Insurgency Allowance etc.

This information was given by Defence Minister Shri Manohar Parrikar in a written reply to Shri Mahendra Singh Mahra in Rajya Sabha today.

Click to view the Pres Release

Check out top 10 points to clear all doubts in mind regarding the 7th Pay Commission pension, pay scales, MSP, MACP and more:

Check out top 10 points to clear all doubts in mind regarding the 7th Pay Commission pension, pay scales, MSP, MACP and more:

7th Pay Commission pension, pay scales – highlights: 

The 7th Pay Commission report has recommended an average 23.55% hike in salaries and allowances of Central government staff and the same is likely to be replicated in all the states too, except Puducherry where the same system as in Centre is already applicable – minimum pay set at Rs 18,000 per month and maximum pay at Rs 2,50,000 per month – recommended date of implementation: 01, January, 2016.
Here we provide all you ever wanted to know in 10 points on most crucial aspects of the 7th Pay Commission report:

1. 7th Pay Commission pension, pay scales, allowances – Minimum Pay:
Based on the Dr Wallace Aykroyd formula (nutrition) , the minimum pay (salary) in government is recommended to be set at Rs 18,000 per month; Maximum Pay: Rs 2,25,000 per month for Apex Scale and Rs 2,50,000 per month for Cabinet Secretary and others presently at the same pay level. If passed, the salary hikes this report is recommending are likely to boost demand for consumer goods across the spectrum, even though it could also be inflationary. (Reuters)

2. 7th Pay Commission pension, pay scales, allowances – Advances:
a. All non-interest bearing Advances have been abolished; b. Regarding interest-bearing Advances, only Personal Computer Advance and House Building Advance (HBA) have been retained. HBA ceiling has been increased to Rs 25 lakhs from the present Rs 7.5 lakhs. (PTI)

3. 7th Pay Commission pension, pay scales, allowances – Pension:
The Commission recommends a revised pension formulation for civil employees including CAPF personnel as well as for Defence personnel, who have retired before 01.01.2016. This formulation will bring about parity between past pensioners and current retirees for the same length of service in the pay scale at the time of retirement. The 7th Pay Commission received many grievances relating to New Pension System (NPS). It has recommended a number of steps to improve the functioning of NPS. It has also recommended establishment of a strong grievance redressal mechanism. (PTI)

4. 7th Pay Commission pension, pay scales, allowances – Performance Related Pay:
The Commission has recommended introduction of the Performance Related Pay (PRP) for all categories of Central Government employees, based on quality Results Framework Documents, reformed Annual Performance Appraisal Reports and some other broad Guidelines. The Commission has also recommended that the PRP should subsume the existing Bonus schemes. (PTI)

5. 7th Pay Commission pension, pay scales, allowances – New Pay Structure:
Considering the issues raised regarding the Grade Pay structure and with a view to bring in greater transparency, the present system of pay bands and grade pay has been dispensed with and a new pay matrix has been designed. Grade Pay has been subsumed in the pay matrix. The status of the employee, hitherto determined by grade pay, will now be determined by the level in the pay matrix. The rate of Annual Increment is being retained at 3 percent. (PTI)

6. 7th Pay Commission pension, pay scales, allowances – Modified Assured Career Progression (MACP):
a. Performance benchmarks for MACP have been made more stringent from “Good” to “Very Good”; b. The Commission has also proposed that annual increments not be granted in the case of those employees who are not able to meet the benchmark either for MACP or for a regular promotion in the first 20 years of their service; c. No other changes in MACP recommended. (Thinkstock)

7. 7th Pay Commission pension, pay scales, allowances – Military Service Pay (MSP):
The Military Service Pay, which is a compensation for the various aspects of military service, will be admissible to the Defence forces personnel only. As before, Military Service Pay will be payable to all ranks up to and inclusive of Brigadiers and their equivalents. The current MSP per month and the revised rates recommended are as follows: (Reuters)

8. 7th Pay Commission pension, pay scales, allowances – Short Service Commissioned Officers:
Short Service Commissioned Officers will be allowed to exit the Armed Forces at any point in time between 7 and 10 years of service, with a terminal gratuity equivalent of 10.5 months of reckonable emoluments. The Seventh Pay Commission also says they will further be entitled to a fully funded one year Executive Programme or a M.Tech. programme at a premier Institute to better their prospects in later life. (PTI)

9. 7th Pay Commission pension, pay scales, allowances – Allowances:
The Commission has recommended abolishing 52 allowances altogether. Another 36 allowances have been abolished as separate identities, but subsumed either in an existing allowance or in newly proposed allowances. Allowances relating to Risk and Hardship will be governed by the proposed Risk and Hardship Matrix. a. Risk and Hardship Allowance: Allowances relating to Risk and Hardship will be governed by the newly proposed nine-cell Risk and Hardship Matrix, with one extra cell at the top, viz., RH-Max to include Siachen Allowance. (PTI)

10. 7th Pay Commission pension, pay scales, allowances – Financial Implications:
The total financial impact in the FY 2016-17 is likely to be Rs 1,02,100 crore, over the expenditure as per the “Business As Usual” scenario. Of this, the increase in pay would be Rs 39,100 crore, increase in allowances would be Rs 29,300 crore and increase in pension would be Rs 33,700 crore. In percentage terms the overall increase in pay & allowances and pensions over the “Business As Usual” scenario will be 23.55 percent. Within this, the increase in pay will be 16 percent, increase in allowances will be 63 percent, and increase in pension would be 24 percent. (Image by PTI)

Source:  financialexpress.com

7th CPC Report: Military Service Pay (MSP) for Defence Forces Personnel

7th CPC Report: Military Service Pay (MSP) for Defence Forces Personnel

The defence forces personnel, in addition to their pay as per the Matrices above, will be entitled to payment of Military Service Pay for all ranks up to and inclusive of Brigadiers and their equivalents. The Commission recommends an MSP for the four categories of Defence forces personnel at Rs.15,500 for the Service Officers, Rs.10,800 for Nursing Officers, Rs.5,200 for JCO/ORs, and Rs.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. Military Service Pay will however not be counted for purposes of House Rent Allowance, Composite Transfer Grant and Annual Increment.

 
Authority: http://7cpc.india.gov.in/