Friday, May 19, 2017

The Notional Pay Based VII CPC Pension Formulation : Lt Col And Equivalent Ranks

It is quite possible that theorizing on outcomes, based on bare assumptions, can lead to grossly inaccurate and misleading views on how re-formulation of VII CPC pensions would shape up.

The increment based formulation as recommended by VII CPC, now having been modified to a calculation based on notional pays in successive pay commissions, could resolve a lot of anomalies related to OROP provided it is implemented keeping firmly in view how OROP and the VII CPC matrix need to form part of a whole.

The scope of this blog post is restricted to the retirees in rank of Lt Col for the sake of simplicity. The intention is to illustrate how the qualifying service of a retiree, a concept central to OROP, needs to be taken into account during any exercise involving fixation of pensions in the VII CPC matrix.

Some key issues arise :

  • Notional pay of most VI CPC Lt Col retirees are likely to correspond closely to stages in Level 12A of the VII CPC matrix as increments, qualifying service for both VI and VII CPC serving personnel are the same.
  • Lt Cols who retired before 01 Jan 2006, especially those who retired prior to Dec 2004, are likely to have a mis-match between their qualifying service and that of those who retired after 01 Jan 2006. All affected know Lt Col rank became applicable on time-bound basis at a qualifying service of 13 years with effect from 16 Dec 2004.
  • For fixing the VII CPC notional pay of pre 01 Jan 06 Lt Col retirees, there ought to be some consideration applied to the fact that the notional pay finally arrived at should not be less than the VII CPC notional pay of a VI CPC Lt Col retiree with equal qualifying service.
  • Then, there is the old issue of the need of parity of pensions of older Lt Col retirees with pensions of Col(TS) with equal qualifying service, if they had put in a service of 26 years or more.
Full clarity will emerge only when detailed instructions are issued on re-formulation of VII CPC pensions of armed forces veterans. The following table is meant to illustrate how the re-formulation should proceed :

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