The Effect Of Rank Pay On Rank Stages And Increments : IV CPC

It needs to be repeatedly stated that the how, when, and even if, involved in the implementation by MOD of the Judgement on what we call the "Rank Pay Case" remain real constraints in getting a true picture of what will finally emerge regarding the issue.

But more and more, the inputs and hints one receives on the net indicate that the focus needs to be on the way the running pay scale was defined in addition to how one's emoluments were calculated for revising the pay wef 01 Jan 86. In the previous blog-post, understandably, there have been some queries on how the career profiles at the time would have fitted in with the guesstimates of what the starting pay at each rank-stage should have been.

Defining three basic assumptions needs to be taken care of in this regard:

1.The starting point of the running payscale, and the portion till the rank-pay starts, remain unchanged.

2.The starting pay of Captain is fixed in relation to the nearest equivalent civilian post.

3.The fixation of starting stages for subsequent ranks would be at the next higher stage as per the earlier fixation with the rank pay added.

Now with this, the increments and pay-stages defined in the IV CPC running pay scale do not hold. This leads to my repeatedly stated doubt whether the judgement of the Hon'ble Supreme Court can be implemented only by re-defining the running pay-scale of IV CPC.

In the case of Maj AK Dhanapalan, since there was just one individual set of accounts that was required to be considered, perhaps it was not necessary to see how the rest of the pay-scale got affected. Now, the situation is different.

With the afore-mentioned assumptions, here is one of the ways the IV CPC running pay-scale could be looked at if one chooses to include rank pay along with the previously defined basic-pay stages: 2300-100-2500-150-3100-190-4050-150-4800-187.50-5550-200-6350.

One would like to stress, once again, this is merely hypothetical and could be diametrically opposed to the correct or official interpretation. Nevertheless, it's a point of view and the real solution could be a slight or large variation on this theme. With the above pay-scale, the rank stages could have looked something like this (please click on the table for a clearer view):

The IV CPC Running Scale Conundrum

At the very outset, there appears to be something the matter with the running pay-scale (shown shaded in yellow in the 2nd table, at the bottom of this blog post) that was defined for armed forces Officers by IV CPC.

The emoluments, as on January 1986, in respect of unrevised basic, dearness allowance, interim relief and 20% of unrevised basic pay were added and the sum obtained was fixed in the new running pay scale introduced at the time. The newly fixed basic was, in most of the cases, less than the next “higher stage” on the running pay-scale. It is surmised, the revised basic was fixed keeping in view the minimum pay defined for each rank fixed in the running pay-scale and the number of years of service in that rank for every individual Officer.

Firstly, the new basic pension pay should never have been fixed lower than the sum arrived at by adding the emoluments.

Secondly, the stage for each rank as defined in the new running scale should have been fitted at the next higher pay in the running scale after calculating the sum in the afore-mentioned manner for each rank then drawing a fixed basic pay, DA, IR.

If a Major, just promoted, had the unrevised basic of 1550/-, DA 1470/-, IR 225/- and 20% unrevised basic 310/- i.e. a sum of 3555/-, his stage in the running pay scale should have been Rs. 3600/-. But it was fixed at Rs. 3400/-. This seems strange because if IV CPC defined the new basic pay-scale, each rank-stage in that basic payscale should have minimally conformed to the CPC’s own method of calculating the new basic pay with the IV CPC’s own afore-mentioned formula.

But as it turned out, the new running pay scale introduced by IV CPC did not account for rank pay being part of the basic pay. This has now been found to be incorrect following the 04 Sep 2012 judgement of the Hon’ble Supreme Court. If rank pay is added to the basic, the new fixation of the rank-stages in the running pay scale gets shifted to the right against the running pay-scale for all ranks affected by rank pay.

Taking the example of the starting pay of a Major in the running scale, a graphical representation makes it clear there are issues regarding the fixation. The following screenshot displays the aspect

If one could get access to the pay-scales of III CPC, a row could also be made to establish the rank-stage on the revised running pay-scale for each rank prior to the pay fixation as was done for the example of the rank of Major. It would be found that even without adding the rank pay, the minimum pay for each rank would be higher than the one fixed at the time of IV CPC in the pay-scale.

So the following questions arise for the not so well informed, like myself, amongst the affected parties:

• Does the judgement essentially require the revision of the running pay-scale itself?

• Would the revision of the running pay scale as well as revision of the formula for adding up the unrevised emoluments be required to implement the judgement?

• Which of the alternatives for calculating arrears that seem obvious would best fit in with the judgement? {The pay stages shown in italics and shaded blue are by logical extension of the actual pay-scale on account of the displacement of rank stages due to addition of rank pay}

EFFECT OF ADDING RANK PAY TO BASIC PAY ON RANK-STAGES IN THE IV CPC RUNNING PAY-SCALE



From Rank Stages IV CPC



The Fog Begins To Lift : IV CPC Rank Pay Arrears

It will be some time before all the affected Officers of the Indian Armed Forces, serving and retired, are presented with the exact norms of calculating their arrears of pay and pension, following the recent judgement of the Hon'ble Supreme Court. How the administrative machinery chooses to interpret the judgement would be revealed only when the Government issues formal orders to the disbursing agencies on the manner of calculating of arrears and effecting of payment.

 

The judgement generated megatons of enthusiasm and a virtual explosion of opinions and theories, not all based on hard facts or the soundest of reasoning. But, these did have one positive effect viz., of prompting many to think of what actually transpired at the time of fixation of pay based on recommendations of IV CPC. Now opinions are being heard or read round the clock that similar, or worse, anomalies arose due to implementation of V and VI CPCs.

 

It begins to appear now that the issue was not merely of adding or subtracting the rank pay to the new running scale introduced at the time of IV CPC. Certainly, the incorrect subtraction of rank pay from emoluments used for fixing the revised pay was central to the litigation. But, a reference to the old pay-fixation statement of IV CPC reveals how, even without getting into the issue of rank pay, the re-fixed pay, in many cases, was lower than the formula of [Basic_Pay+DA+IR+20%Basic_Pay] used. An example was cited online as to how the sum of Rs.3555/- arrived at in the case of one Major, was rounded off to Rs. 3400/- and NOT to the next higher stage of 3600/-, or even the one lower stage of Rs. 3500/-, in the pay-scale of Rs 2300-100-3900-150-4200-EB-150-5100 introduced at that time.

 

It would appear the basis of such fixations was the running payscale, which itself was defined without taking the rank-pay into account. The minimum, starting pay for each rank was thus fixed in this running payscale without taking into account the rank pay, which the judgement has now clearly established as being part of basic pay.

 

Now, of course, the formula for calculating emoluments itself needs to be revised in line with the judgement as pointed out in the previous blog post. As to how fixations need to be effected keeping the payscale and minimum-pay issues in view is still not clear. How wide the ramifications could be can be gleaned from the screenshot of a short conversation on a chatroll.

 

 



The Arrears Calculation Frenzy

Following posts on some blogs and media web-sites about the judgement on the Armed Forces Officers' "Rank Pay" case, enthusiasts and optimists chose to flood the web with estimates, queries, opinions and views on what the arrears would be. There have been numerous chats and discussions on the manner of calculation of arrears and the likelihood of further action on obtaining an enhancement of the interest-component ordered by the Hon'ble Supreme Court.

It has to be said, the matter has generated so much of interest and attention amongst the armed forces officers, serving and retired, that it's difficult to think of another instance in living memory of such a sense of collective involvement. After-all, matters such as OROP or NFFU are still in the "Pie In The Sky" class. One may see these hopes and aspirations being realized, or one may not. But the IV CPC rank pay issue strikes a slightly different emotional chord. It represents, directly, a sense of having been wronged, of a fair entitlement having been denied. Matters were not  helped by the not exactly benign and friendly stance represented in the legal contest mounted against the delivery of this entitlement.

Now, at the time of this blog post, it's not known what the judgement exactly says. It's also not known what the response will be from the administrative machinery engaged with the matter. From the gist of the matter, as brought out in the media and on blog posts, it would appear the judgement requires that the pay of all affected officers be refixed wef 01 Jan 86 and the arrears paid, with interest at 6% accruing from 01 Jan 2006.

Understandably, as long as the matter was sub-judice, the individuals and associations would have been reticent in respect of the intricacies of representations made during the litigation process. The net result is it is anybody's guess as to by how much were officers denied their dues through the 'incorrect' deduction of rank pay at the time of pay fixation post implementation of IV CPC. One excel spreadsheet in circulation, representing a train of extremely 'positive thinking', uses the amount of the entire rank pay of the time as arrears, with the resulting sum sufficient to upgrade one's car with ease. Another "brief", purportedly issued by one of the services headquarters, cites examples of the calculations involved and appears to offer, at first glance, a more realistic appraisal of the matter.

Summarising a few basics may not exactly be a bad idea before succumbing to the spreadsheet urge. Basically, the issue requires clarity in respect of the following: 

• It was not the 'Rank Pay' that was denied wef 01 Jan 86, but an amount equal to the rank pay was deducted from the calculation for arriving at the 'refixed' pay wef 01 Jan 86. That does not mean the arrears for the month of January 1986, resulting from the incorrect calculation were equal to the rank pay. 
• Essentially, the issue is how the total unrevised emoluments were calculated for January 1986 and how the revised emoluments were then used to "fix" the basic in the revised pay scale. Because of the rounding off involved, the difference between the revised basic pay as fixed and the revised basic pay as it should have been calculated, was considerably less, in most cases, than the rank pay amount itself. So, calculating arrears based on the rank pay amount may not exactly be the most rational solution. The new SUV may have to wait awhile.
•  IV CPC : The following formula was used for calculating the basis for refixing the pay: 

• Unrevised Basic Pay for January 1986+DA+Interim Relief+20% of Unrevised Basic Pay for January 1986. Though the Rank Pay granted wef January 1986 was to be added to this, it wasn't and hence the litigation.
•  The amount obtained, without including the rank pay, was used to refix the revised basic by rounding off to the nearest figure for the rank in the new payscale of  Rs 2300-100-3900-150-4200-EB-150-5100. This refixed pay was less than what it should have been if Rank Pay had been included in the calculation, but not by an amount equal to the rank pay.
• It is only a guestimate, and ought to be treated as such, but that afore-mentioned "brief", purportedly from one of the services HQs, does offer an insight into how the calculation ought to have taken place. The "brief" says the calculation should have been Unrevised Basic Pay for January 1986+DA+Interim Relief+20% of Unrevised Basic Pay for January 1986+Rank Pay For January 1986.
• There has been a hum, and the jury is still out on that one, as to why the calculation should not have been  Unrevised Basic Pay for January 1986+DA+Interim Relief+20% of the sum of Unrevised Basic Pay for January 1986 and Rank Pay For January 1986+Rank Pay For January 1986.

• Now, what the precise submission has been by the litigants and how exactly the Hon'ble Supreme Court has ruled is anybody's guess at the present juncture. But if one of the above-mentioned ways of calculation does fit the bill, then the next question is, does the sum arrived at form the basis for directly fixing the revised pay in the scale by rounding off to the next stage OR does one first subtract the rank pay from the sum and then fix the amount arrived by rounding off as revised pay in the scale. That aforementioned "brief" would appear to suggest the latter course, even though it does not propose inclusion of rank pay along with the basic pay in the 20% part of the equation.

•  So, we are presented with a number of possible solutions right at the stage of IV CPC: Calculation with Rank Pay in 20% portion or without. Fixation with removal of rank pay from sum arrived at or without.  

• V CPC : After we arrive at a solution, we need to deal with the pay fixation for V CPC. Now, in this case the pay fixation was done with this formula Unrevised Basic Pay for January 1996+DA+Interim Relief+40% of Unrevised Basic Pay for January 1996+Unrevised Rank Pay For January 1996. It is quite possible revised rank pay for January 1996 should have been added and NOT the unrevised one. From the sum arrived at, the revised rank pay of January 1996 was subtracted, and the resulting figure was fitted in the appropriate scale by rounding off. This leads to the following alternatives for calculating the revised pay in line with the judgement : 

• Unrevised Basic Pay for January 1996+DA+Interim Relief+40% of sum of Unrevised Basic Pay and Unrevised Rank Pay for January 1996+Unrevised Rank Pay For January 1996. 
• Unrevised Basic Pay for January 1996+DA+Interim Relief+40% of sum of Unrevised Basic Pay and Revised Rank Pay for January 1996+Revised Rank Pay For January 1996.

The foregoing is based on guesswork. Details being known only to the direct litigants, the purpose of this blog post is not to state "what is what" but point to the difficulty of establishing "what is what". It would, therefore, be foolhardy, to hazard a guess as to the likely volume of the anticipated inflow of funds. If not a trickle, it may not be the flood some may be thinking about. It may be best to wait for clarifications from RDOA and for the issue of formal orders by the adminstrative machinery.

The essence of the matter is that fairness has prevailed, the diligence of the litigants has borne fruit and the collective stand has been vindicated.

RDOA'S GLORIOUS VICTORY

Whenever cynicism, coupled with bitterness and it's cousin, apathy, tend to turn from unwelcome guests into permanent encroachers on the cerebral landscape, there's always some form of salvation in the shape of an individual, or group of individuals who, through sheer will and doggedness, set about redressing wrongs.

RDOA's legal victory, is in effect, just such an example of 'salvation'. The effective manner in which the association steered and co-ordinated the litigation connected with the "Rank Pay Case" related to IV CPC ought to serve as a benchmark for decades to come.

The fact that RDOA pursued the matter, through it's tortuous course, in the collective interest serves to underscore the superlative gallant spirit so easily discernible in this great legal triumph. (link now expired).

Pension Anomaly Resulting From AVS-I {Updated 18 January 2013}

{NOTE: Contents of this blog post have been updated to reflect the current situation as on 18 Jan 2013, following implementation of Committee Of Secretaries Recommendations}

 
Now that we're awaiting the recommendations of the panel on anomalies affecting pay and pensions of armed forces have been implemented, there are expectations, that some of the less prominent existing anomalies would be rectified and similar aberrations would be prevented in future when the complex processes of introduction of NFFU and modified parity are approached by the powers that be, have not been met fully.

In this context, an existing anomaly, affecting a portion of the armed forces veterans fraternity, requires to be highlighted as it's closely linked to the issue of parity of pensions. It may be added at the outset, any views, comments or corrections in respect of what follows would be very welcome.

• While fixing pensions for Armed Forces Officers who had retired prior to 01 Jan 2006, VI CPC had, initially, not placed retirees in the ranks of Lt Col and Lt Col(TS) in pay band IV. This was done subsequently.
• Even then, no consideration was applied to the issue of parity of pensions of retirees who had retired prior to implementation of Phase-I recommendations of AV Singh Committee with pensions of retirees with equal service who retired after the implementation of AVS-I.
• This led to Officers, holding the same type of commission and with the same qualifying service, being fixed in different pension-tables post VI CPC depending on which side of the AVS-I implementation date they retired on.
• Upto a service tenure of 26 years, the pension of a pre AVS-I Lt Col and Lt Col(TS) would not be an issue. But for a qualifying service of 26 years or more, a retiree with a PC would have automatically been fitted in the pension table for Col/Col(TS) at a pension of Rs.26050/- 27795/- if he had retired after implementation of AVS-I.
• A pre AVS-I Officer retiree, in the rank of Lt Col, also with the same qualifying service of 26 years is now fitted in the column for Lt Cols at a monthly pension of 25700/- 26265/-, and a pre AVS-I Lt Col(TS) at a monthly pension of Rs.24143/- 24674/-.
• {Edit}: These amounts reflect revisions following the implementation of recommendations of the COS Committee and the difference between pre and post AVS-I retirees has become even more glaring.

• {Edit 2}:    A similar anomaly existing for Major retirees with more than 21 years of service was recently rationalised albeit on different grounds but reflecting on principles very similar to those sought to be highlighted in this blog post. More details on that rationalisation can be accessed through this link.

At a time when a weighty subject like One Rank One Pension is hanging fire over the entire veteran community, surely this anomaly ought to strike some people as being an issue. It requires to be understood that this pre/post AVS-I issue would also impinge on pensions of Major, Capt and Lt, though different conditions might apply.

This also does not exactly amount to yet another outburst as to why the AVS-I recommendations were not implemented retrospectively. Here the issue is an award of VI CPC, not AVS-I, which treats two identical tenures of service differently while fixing pension merely on account of the intervention of the implementation of AVS-I.

All service people would know there is no select rank involved here. If an Officer retiring post AVS-I after 26 years of service automatically gets Rs. 26050/- 27795/- as pension without getting the next select rank, it stands to reason the pay-commission should have fixed the pension at the same level in the case of all other Officers, with the same type of commission and with the same qualifying service, who retired without picking up the next equivalent select rank prior to AVS-I.

This line of reasoning ought to have been given due consideration at the time of implementing the anomalies-panel recommendations. The subject of the blog post relates merely to the parity of one set of armed forces pensioners. When fitment into bands takes place after introduction of NFFU, these concerns could assume even greater importance and complexity.

The following table aims to bring out the rationale for refixing the pensions of pre AVS-I Lt Col/Lt Col(TS) retirees (with qualifying service of 26 years and more) to equal those fixed for post AVS-I Col/Col(TS), with equal service,  as shown in the area shaded yellow.

Qualifying Service	PENSIONS OF PRE 01-01-2006 PENSIONERS VIDE ANNEXURE-A to MOD LETTER 1(11)/2012-D(Pension/Policy) 17-01-2013 {All figures subject to verification}			PENSIONS REQUIRED FOR OBTAINING PRE/POST AVS-I PARITY
	LT COL(TS)	LT COL	COL/COL(TS)	LT COL(TS)	LT COL
				{FOR THOSE WHO, IF THEY HAD NOT RETIRED BEFORE AVS-I, WOULD HAVE BEEN ELIGIBLE POST AVS-I FOR COL[TS] RANK ON COMPLETION OF 26 YEARS OF SERVICE MENTIONED IN FIRST COLUMN}
20	19898	21490	22742	19898	21490
20.5	20296	21888	23163	20296	21888
21	20694	22286	23584	20694	22286
21.5	21092	22684	24005	21092	22684
22	21490	23082	24426	21490	23082
22.5	21888	23480	24848	21888	23480
23	22286	23878	25269	22286	23878
23.5	22684	24276	25690	22684	24276
24	23082	24674	26111	23082	24674
24.5	23480	25072	26532	23480	25072
25	23878	25470	26953	23878	25470
25.5	24276	25868	27374	24276	25868
26	24674	26265	27795	27795	27795
26.5	25072	26265	27795	27795	27795
27	25470	26265	27795	27795	27795
27.5	25868	26265	27795	27795	27795
28	26265	26265	27795	27795	27795
28.5	26265	26265	27795	27795	27795
29	26265	26265	27795	27795	27795
29.5	26265	26265	27795	27795	27795
30	26265	26265	27795	27795	27795