Anomaly Committee Meeting for Calculation of Disability Pension for Defence Forces’ Personnel under 7th CPC Recommendations to be held on 01.12.2016

01st Anomaly Committee Meeting for Calculation of Disability Pension for Defence Forces’ Personnel under 7th CPC Recommendations to be held on 01.12.2016

No. 11/2/2016- JCA (Part)

Ministry of Personnel & Training

Department of Personnel & Training

(JCA Section)

New Delhi, dated the 24th November, 2016

OFFICE MEMORANDUM

Sub.: 1st Meeting of the Anomaly Committee to be held on 01/12/2016 under the Chairmanship of Secretary (P) on the calculation of the Disability Pension for Defence Forces' Personnel as per the recommendations of the 7th central Pay commission.

In continuation of this Department's O.M. no. dated 23.11.2016 on the subject as mentioned above, a copy of the agenda note to be taken up for discussion in the said meeting is forwarded herewith for kind perusal.

Encl. as above

Sd/-

(D.K. Sengupta)

Deputy Secretary (CPC/ JCA)

AGENDA FOR DISCUSSION IN THE ANOMALY COMMITTEE MEETING TO BE HELD AT 11.00 A.M. ON 01.12.2016 UNDER THE CHAIRMANSHIP OF SECRETARY, DoPT)

The Agenda for discussion pertains to the issue of demand of Defence Forces Personnel for restoration of the percentage-based methodology for the calculation of Disability Pension to the Defence Forces Personnel. The 7th CPC has recommended a slab-based methodology for calculation of Disability Pension for them. As per their demand, while the 7th CPC has recommended slab-based system for calculation of Disability Pension for the Defence Forces Personnel, it has not made any recommendation for the civilians which continue to be percentage-based. Therefore, their contention is that the proposed slab-based Disability Pension system will lead to an anomaly between the Civilian side and the Defence Forces Personnel.

It has been decided to refer the matter for urgent consideration before the National Anomaly Committee.

2. The recommendations of the 7th CPC on this issue is contained in para no. 10.2.55 which is at Annexure-I.

3. The justification for the recommendation given by the 7'h CPC in paras 10.2.49 to 10.2.51 are at Annexure-II, III & IV.

4. The representatives from the Defence Forces Personnel in a meeting held on 11.11.2016 have inter alia contended that:

a) That the 7th CPC-recommended slab-based Disability Pension System wilt, if implemented, lead to an anomaly between the civilian side and the Defence Forces Personnel because the civilian side will continue to be governed under a percentage-based system.

b) The basis of the 7th CPC recommendations for introduction of the slab-based system for the Defence Forces Personnel, viz. that the percentage of officers retiring with disability element has increased, is erroneous. According to their contention between 5th & 6th CPC, the number of retirement cases with disability element has, in fact, fallen as below:

Rank	5th CPC Regime Range (Slab Based)	6th CPC Regime Range (Percentage Based)
Lt. Col.	1.2% to 38%	7.5% to 27.2%
Col.	4.8% to 24.9%	3.3% to 23.3%
Brig.	4% to 17%	2.7% to 21.6%
Maj. Gen.	4% to 17.5%	0% to 16.5%
Lt. Gen.	10% to 50%	0% to 15.4%

C) 7th CPC has erroneously assumed that the slab-based system would benefit the lower ranks by narrowing down the gap between the maximum and the minimum. As per their conclusion, except for benefiting a miniscule number of Defence Forces Personnel who would get invalidated out in the lower ranks of service, the slab- based system would be detrimental to most ranks in ali superannuation cases.

5. Point-wise inputs on the contention received from the D/o Ex-Servicemen Welfare at Annexure-V are briefly as under:

a) 7th Pay Commission has recommended slab-based system for disability element of disability pension for Defence Forces Pensioners. However, the 7th CPC has not made any recommendation for the civilians. The existing system of disability on percentage-based system would, therefore, continue in civil side. This has led to an anomalous situation.

b) A comparative statement indicating the percentage of retirees with disability during 5th CPC era when slab-system was prevalent vis-a-vis retirees with disability during 6th CPC when percentage system was placed is as under:

Ranks	Percentage of retirees with disability during 1996 to 2005 (5th CPC)	Percentage of retirees with disability during 2006 to 2015 (6th CPC)
Lt. Col/Equivalent	2.04% - 18.3%	7.5% - 21.2%
Colonel/Equivalent	1.56% -17.38%	3.3%-23.3%
Brigadier/Equivalent	2.08%-17.42%	2.7%-21.6%
Major General/Equivalent	0.0%-11.27%	0.0%-16.5%
Lt. General/Equivalent	0.0%-21.88%	0.0%-15.4%

It could be seen from the data given by CGDA office that percentage of retirees for commissioned officers have increased in 6th CPC regime vis-a-vis 5th CPC.

C) Pre 2016 retirees

The comparison between slab and percentage system of disability element for pre-1.1.2016 retiree pensioners have been made with reference to pay last drawn by migrating the same in 7th CPC pay structure and also by working out the disability element by linking the same with revised service pension under 7th CPC. The statements indicating tank wise, qualifying service wise status in both the said scenario are attached as Annexure-V (‘B’ and ‘C’) respectively. The statement indicates that all commissioned officers are at disadvantage in case the slab recommended by 7th CPC is implemented. However, in case of JCO/ORs, lower ranks are getting benefited under slab rates.

Further the details of 1,09,938 JCO/OR retirees have also been analyzed on actual basis as data for these pensioners were readily available. It could be seen from the outcome tabulated as Annexure-V ('D'), that lower tanks of JCO/OR are getting benefited especially Sepoy, Naik & Naib Subedar. Out of 1,09,988 records of JCO/OR processed, 85,640 (77.86%) pensioners would get benefited under slab rates. It is also intimated to the Ministry that pension for all pre-1.7.2014 retirees have been revised under OROP orders. It has been observed/ analyzed that the pension of JCO/OR pensioners who are drawing pension on OROP rates (pre-2006 retirees and post-2006 retirees who retired upto 2009-10), are getting benefitted under slab rates of disability pension.

Post 2016 retirees

For post-1.1.2016 retirees, no comparison has been made as notification relating to pay entitlement are not yet finalized. However, based on the recommendations of 7th CPC, it could be visualized, that future progression in new pay structure percentage-based system would definitely be beneficial for post-7th CPC retirees in all ranks.

6. The matter is placed before the National Anomaly Committee for consideration.

Annexure-‘I’

Para No. 10.2.55

The feature that stands out when the historical evolution of the regime relating to'disability pension is studied is the shift from slab-based system to a percentage based disability pension regime consequent to the implementation of the 6th CPC's recommendations. This move has been contrary to the tenets of equity insofar as treatment of disability element between Officers and JCOs/ORs is concerned borne out by the fact that the ratio of maximum to minimum quantum of compensation for disability across the ranks is now disproportionately high at 8.6. The Commission is, therefore, of the considered view that the regime implemented post 6th CPC needs to be discontinued and recommends a return to the slab-based system. The slab rates for disability element for 100 percent disability would be as follows:

Rank	Levels	Rate (in Rs. Per Month)
Service Officers	10 and above	27000
Honorary Commissioned Officers
Subedar Major /Equivalents	6 to 9	17000
Subedar /Equivalent
Naib Subedar /Equivalents
Havildar/Equivalents	5 and below	12000
Naik/Equivalents
Sepoy/Equivalents

Annexure-‘II’

10.2.49:-The notable facts about the disability payout regime are:

a) There was a gradual rationalization in the number of slabs from eight, prior to 3rd CPC to three after the 4th CPC.

b) The ratio of maximum to minimum quantum of compensation for disability across the ranks witnessed a decline from 4.85 prior to the 3rd CPC to 1.67 post 5th CPC. As a consequence of the implementation of the recommendations of the percentage based system based on the 6th CPC Report the ratio of the maximum to minimum was reversed and now stands at 8.60.

c) Implementation of the 6th CPC recommendations resulted in a substantial increase in the disability element. For 100 percent disability, at the minimum level, i.e., for ORs, it 'went up from Rs. 1,550 to Rs. 3138, i.e., a little over double and at highest level amongst officers from Rs. 2,600 to Rs.- 27,000, i.e., by 10.38 times.

d) Disability pension consists of two elements viz', service element and disability element. while the service element was linked with the qualifying service, disability element was not. Therefore, for the same level of disability, the service officer invalided out and one who served on and retired in due course, got the same quantum of disability element.

Annexure-‘III’

10.2.50 To examine the recent trends in disability cases, the Commission sought data and further qualifications with regard to all cases of pensioners with disability element. The total number opensionerses superannuating with disability element, each year, from 2007-08 to 2013-14, as provided by the Controller General of Defence Accounts (CGDA) is tabulated below:

Financial Year	JCOs/ ORs	Commissioned Officers	Total	Total JCO/OR Retirees	Total Officer Retirees
2007-08	9,355	285	9,640	49396	2096
	(18.9)	(13.6)	(18.7)
2008-09	6,908	318	7,226	50913	2118
	(13.6)	(15.0)	(13.6)
2009-10	2,644	284	2,928	39133	1712
	(6.8)	(16.6)	(7.2)
2010-11	1,840	316	2,156	38209	1678
	(4.8)	(18.8)	(5.3)
2011-12	4,765	321	5086	48201	1626
	(9.9)	(19.7)	(10.2)
2012-13	5,837	327	6,164	53446	1643
	(10.9)	(19.9)	(11.2)
2013-14	4,037	318	4,355	55901	1606
	(7.2)	(19.8)	(7.6)

Annexure-‘IV’

10.2.51:- The following trends are discernible:

a. As a percentage of the total officer retirees, the number of officers retiring with disabiiity has increased in 2013-14, as compared to 2007-08(13.6 percent to 19.8 percent).

b. The percentage of JCOs/ORs retiring with disability is, on the other hand, decreasing (18.9 percent to 7 .2 percent).

c. The percentage of officers retiring with disability is considerably higher than JCO / ORs retiring with disability.

Source:-NFIR