Fixation of pay of re-employed pensioners - Treatment of Military Service Pay

Dear Verterans,Find below the Goverment order for Fixation of Pay of re-employed ex-serviceman.
Veteran Prabhjot Singh Chhatwal PLS (Retd)

No.3/19/2009 Estt. Pay ll
Ministry of Personnel, Public Grievances & Pension
Department of Personnel & Training

New Delhi, the 8th November, 2010

Office Memorandum

Subject: Fixation of pay of re-employed pensioners -
Treatment of Military Service Pay

The undersigned is directed to refer to the orders issued vide OM dated 5.4.2010 on Fixation of pay of re-employed pensioners. These order inter-alia lay down that on reemployed in civilian organization. Military Service Pay shall not be admissible. However. The benefit of MSP given to all retired Defence Force officers/personnel by reckoning it at the time of calculation of their pension (notionally in the case pre-1.1.2006 pensioner) should not be withdrawn. According, while the pension of such re-employed pensioners will include the element of MSP, they will not be granted MSP while working in civilian organization.

In the instructions issued by the Ministry of Defence vide their letter No. 1/69/2008/D (Pay/Service) dated 24th July 2009, Pre-retirement Pay has been defined as under:

(i) In respect of re-employment taking place on/or after 1.1.2006 per retirement Pay for those who retired after 1.1.2006 means the pay in the Pay band plus grade pay incusive of Non-Practicing Allowance (NPA) if any, last drawn before retirement.
(ii) In case of officers who retired before 1.1.2006 and also those who retired after 1.1.2006 in the pre-revised pay scales without opting for the revised pay scales promulgated on or after 1.1.2006 the pay will be basic pay including stagnating increment and Rank pay plus the Dearness pay and Dearness allowance drawn at the time of retirement.

As per these orders, for pre-2006 retired rank pay is included as a part of pay but for post -2006 retirees, the MSP in not reckoned in the pre-retirement pay for the purposes of pay fixation on re-employment. However for pension purposes the reckonable emoluments are - basic pay + grate pay + MSP + NPA wherever admissible. Therefore, while MSP in not taken into consideration the purpose of pay fixation on re-employment the element of MSP in pension is deducted.
It has been decided in consultation with the Department of Expenditure that since the element of MSP is not reckoned in the pay fixation on re-employment. it need not be reduced from the pension either. Hence, in respect of all those Defence Offices/personnel, whose pension contains an element of MSP, that need not be deducted from the pay fixed on re-employment.


(Mukesh Chaturvedi)
Deputy Secretary

To

All Ministries and Departments