Saturday, April 25, 2020


One widely circulated gospel truth on social media is that in 1973, Smt IndiraGandhi terminated One Rank One Pension, the basis for deciding deciding pension of Indian Armed Forces Personnel ‘which had been in vogue for 26 years since independence’. In addition, the Govt, on the basis of the report of 3rd Pay commission, from which Armed Forces representation was excluded, & which was dominated by bureaucrats, increased the pension of civilians, who retired at 58, from 30 to 50%, a net increase of 20%; and reduced the pension of soldier, NCOs & JCOs by 20%, from 70 to 50% of basic pay,with a caveat that for full pension the minimum service was 33 years.

I did some research and I have gone through many docs, including 4 volumes of 3rd CPC report (attached) to uncover the truth. With out going into finer details, my findings are given below:


1. 3rd CPC was the first CPC for Defence Forces. I quote from para 5, chapter 48 Vol 3 of the report,  
"5. It is for the first time that a Pay Commission has been asked to enquire into the structure of emoluments of both the civ employees, of the Govt and the Armed Forces. In the past, the latter, was entrusted to departmental committees which included the representatives of the Services also."

2. There was no bureaucratic interference in proposals made by services. Ex Chiefs Gen Kumaramangalam and Adm Chatterjea were invited for discussions besides some other veteran officers. I quote from para 7, chapter 48 Vol 3.

"Report of the Expert Cell was finalised only by the Service members. The Ministry of Defence in, their letter forwarding the Report of Expert Cell in June, 1971, clarified that "the views contained in the Report are those of the Service Experts, as endorsed by the three Service Chiefs".

3. Commission also visited forward posts at heights of 13000 feet, air bases, ships, submarines, ordnance depots, hospitals etc. to gain first hand experience of service hardships.

There is no evidence of any bureaucratic or political interference in the report. The CPC was headed by a retd SC justice, Sri Raghubar Dayal.

Pensions before 3rd CPC. Pensions were worked in fractions and not in percentages, as is being claimed by many dubious sources. For ease of understanding, fractions will be converted to % in subsequent text.

Armed forces Pensions.  Armed forces pay and pensions were lower than those of the Britishers. During II World War these were hiked for obvious reasons. After world war, these were reduced drastically and brought more or less in line with civilians.After Independence,pensions of Armed Forces were fixed by Armed Forces Pension Revision Commi-ttee (AFPRC). It’s recommendations were implemented wef 01 Jun 53. Pensions remained more or less fixed till next pay commission for civilians was finalised. For example a Lt Col drew a fixed pension of Rs.625/- from Jun 1953 till Oct 1961. No DA/DR was admissible to pensioners before 3rd CPC. Later pension was increased to Rs 675 in Oct 1961. In Sep70 pension was reduced to Rs 587/- to compensate for grant of Death Cum Retirement Gratuity (DCR).

As for as PBOR are concerned, upper retirement age was 50 years for Army and 55 years for other two services. For officers &PBOR, AFPRC used the formula of 1/60 to work out pensions rank wise. Maximum pension was capped at 30 years of service. A person retiring with 30 years or more of service got a pension 30/60 (50%) of the rank emoul-ments. The pension was not worked for individuals. It was worked rank wise. Rank was to be held for at least 2 years to get pension for the same rank. However, it was based on the minimum pay of the rank for officers and mean of the pay grp for PBOR. There was a depression of 2 years for PBOR who served from 15 years to 25 years. Therefore,  soldiers were compensated for 13 years of service while they actually served for 15 years and so on. This depression was removed in 1968. Service pensioners did not receive any DCR till 1970. In 1970, DCR was introduced, where as civilians were receiving DCR since 1950 with their pensions reduced proportionately from 1/60 (50%) to 1/80 (37.5%). The loss of pension was 12.5% to compensate for DCR. On similar lines, to compensate for DCR in 1970, officer's pension was reduced by appx 8% and PBOR 11%.

From the information given above, it is evident that before 3rd CPC a PBOR retiring with 15 years of service got a pension of 15/60 (25%) less 11%. A PBOR retiring with 30 and more years of service got 30/60 (50%) less 11%, appx. 39% of his emoluments as pension. It is clear that no PBOR got a pension of more than 39% of emoluments contrary to the belief that the PBOR pensions were 70% before 3rd CPC and OROP was in vogue. 

Liberalised Family Pension - Conditions. Mrs Indra Gandhi for the 1st time introduced Liberalised Family Pension for war widows& their children. It was made effective from 1947 to include all past operations including Counter Insurgency Operations. In case of death of an Armed Forces Personnel under the circumstances mentioned below, eligible member of the family is entitled to Liberalised Family Pension equal to reckonable emoluments last drawn, both for officers and PBOR. LFP at this rate is admissible to the widow in the case of officers and to the nominated heir in the case of PBOR until death or disqualification.

G.O.I, M.O.D. vide its letter No. 200847/Pen-C/71 dt. 24.2.72, decided to grant Liberalized Pensionary Awards equivalent to the basic pay + increments +rank pay +good service pay+ dearness pay + home saving element to the nominated heir of PBORs of Armed Forces personnel as well as NCs(E), (including APS and DSC personnel), who were killed in action or disabled in the operations against any neighboring country and as well as in following actions:

1. 1947-48 Kashmir Operations, international wars of 1962, 1965 (incl Kutch and Kargil Ops.), 1971, as well as Goa& Hyderabad operations.

2. In warlike operations or border skirmishes either with Pakistan on cease fire line or any other country, operation against armed hostiles like Naga & Mizos and also while deployed in peace-keeping mission abroad.

3. During laying or clearance of mines:These benefits were granted wef 1-2-1972 to the nominated heirs/NoKs of all personnel who were killed in above actions and operations from 1947-48 onwards.

Rates of Liberalised Family Pension. Under this category nominated heir of the PBOR will be granted Lib. Family Pension equal to reckona- ble emoulments last drawn which includes Pay in pay band + GP+MSP + X Group Pay if any + Classification allowance actual drawn if any until death or disqualification. If a PBOR is not survived by widow but is survived by child (ren) only, all children together shall be eligible for Lib. Family Pension at the rate equal to 60% of reckonable emoluments till his/her disqualification i.e. attaining the age of 25 years. On death / disqualification of senior most children it will pass on to next eligible child. And the crippled child if any will be granted continuance award of family pension when all children become disqualified. The crippled child will continue to receive this award for life at the rate equivalent to 60% of Liberalised Family pension.

In addition, Civilians serving in field formations (Cooks, Washer up, Water carriers etc.) were given uniform and made NC(E)s.

Civilian Pensions. As far as Civilian pensions are concerned, their retirement age varied from 50 years for senior officers to 58 years for class IVemployees. Till 1950 they were not getting DCR and their pension was based on 1/60 formula and capped at 30 years of service. They received 30/60 (50%) of last three years of average emoulments  as pension. In 1950 DCR was introduced and their maximum pension reduced to 30/80 (37.5%). This continued till 3rd CPC. Therefore, Civilians as well as PBOR were drawing less than 40% of emoluments as pension by more or less using similar formulas. Both were getting similar DCR too. There was no DA/DR for any one. PBOR had no advantage on account of early retirement.

Post 3rd CPC Pensions.Civilian pension formula wasn't altered much. The significant change was to increase qualifying service for pension from 30to 33 yrs. Thereafter, max pension improved to 33/80 (41.25%) for 33 years of service. Formula for DR was worked out. I quote from para 92 Vol IV, “We received numerous representations suggesting that we should recommend some measures for protecting the pensions of the existing Government employees from erosion on a/c of the possible increases m the cost of Living in future.We recommend that all future
pensioners, irrespective of the amount of pension drawn by them, should be given a relief at the rate of 5 per cent of their pension subject to a minimum of Rs 5 pm and a maximum of Rs. 25 pm. The relief at these rates should be given as and when there is a 16 points rise in the 12-monthly average of the All India Working Class Consumer Price Index (1960=100).”

On the other hand, service pensions were revamped. The same 33/80 formula was used to work out defence pensions. There was no change in rank criteria for earning pension. Pensions were granted as per rank held for two years. Improvements were done to base pensions on the maximum pay of the rank and not minimum/mean pay as was the case earlier. The main high light of the 3rd CPC was that for the first time weightage was given to Armed Forces for early retirement and DR granted.

PBOR, Lt Colonels,Colonels and Brigadiers got a weightage of 5 years, Majors 6 years and Captains below 7 years. This resulted in a PBOR retiring with 15 years of service getting a pension @ 20/80 (25%) compared to 15/80 (18.75%) received by a civilian. A PBOR retiring with 28 years of service received 33/80 (41.25%) in comparison to civilian who received a lower percentage of 28/80 (35%). Hence, for the first time since independence Armed Forces had an edge over civilians in pensions.

Blaming Mrs Indra Gandhi for punishing Armed Forces for winning the war & rewarding civilians instead is an absurd statement without any truth in it. Only anti-national elements are expected to create such fake posts. Unfortunately we fall into their traps and circulate these with out any verification.


Links: 1. Report of  3rd Central Pay Commission, 1973.Vol.I

2. Report of 3rd Central Pay Commission, 1973.Vol.II part I

3. Report of 3rd Central Pay Commission, 1973.Vol.II part.2

5. Report of the Third Central Pay Commission, 1973.Vol.IV.

Best regards,

Wg Cdr RK Bali (Retd.)

(Source : Via e-mail)

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