An overview of the working attitude and pronounced bias of the union government against the defence forces, starting soon after Independence, would be in order to understand why they have reached this low. The Post-War Committee, ostensibly to rationalise the pay structure of the armed forces, linked it to the civil services and ordained as "determined", basing it on the report of the First Pay Commission. The pretext for this mischief was the concept of "all-inclusive pay", brought in the interest of simplicity, by doing away with all manner of allowances admissible to defence personnel.
At the same time, no such reduction was introduced in the case of civil services. This came to be known as the New Pay Code, from which the King's Commissioned Indian Officers (KCIOs) were excluded. This was the first blatant act of divide-and-rule while dealing with the defence services. However, much later, some allowances had to be re-introduced for those other than commissioned officers because their pay had been reduced by one-third.
Compensating for this reduction of pay, soldiers were given a princely sum of Rs. 5 per month as allowance for a hard and risk-filled life. Of course, officers deserved no such consideration. A major was equated with superintendent of police and a deputy inspector general (DIG) figured between a Lt Col and Col. However, after the 2nd Pay Commission, a departmental committee of the ministry of defence (MoD), the Raghuramaiah committee, altered these equations, bringing major changes in the conditions of service and pay scales of IAS and IPS officers: in one case, a police DIG was equated with a brigadier.
No representation of armed forces
This was done not by the Pay Commission but by a departmental committee of the MoD, with no representation of the armed forces. This procedure was repeated in the case of the 2nd Pay Commission (1957) and nothing concerning the defence services came out of it. The 3rd Pay Commission (set up in 1970) was entrusted with the task of determining pay and allowances of defence personnel. The commission wanted the defence services to present their case directly to it.
However, the MoD came up with the preposterous and most absurd stand that, and do hold your breath, "The requirement of discipline in the armed forces does not permit them to put up their case direct to the Pay Commission." Further, the Pay Commission was not required to go into the issue of service conditions of the defence personnel but was to take these as a "given". Unbelievable as it might appear, this ridiculous and untenable stance of the MoD was accepted on the one hand by the top brass of armed forces and on the other by the Pay Commission itself, whose composition needs no elaboration.
'Advantages' of military career
This resulted in creeping back of the "all-inclusive" concept and its attendant disadvantages as this washed away the corrections that had been brought in to soften the "all-inclusive" character of the pay structure. The 3rd Pay Commission did not stop there but came up with an incredulous conclusion, of course after detailed deliberations, that the advantages of a career in the military simply outweigh disadvantages!
Truncated careers, few and extremely limited promotions, long separations from families, hard living conditions in high-altitude, uncongenial and difficult areas, risk to life and limb, and a hundred other travails (called the X factor), which are part of military life and recognised the world over, were seen as great benefits of a career in the defence services! Equating service officers with the police was essentially because they both wear uniform! There were many other gaffes by this Pay Commission, such as equating a fully-trained soldier with a semi-skilled worker!
In every democracy, military service is called a special calling and treated as such. In the US, the maximum pension admissible to a federal employee is 60% of the average of the last three years' pay. In the case of the military, it is 75 years of the last pay drawn. In the 1990s, the lifetime retirement (discounted) benefits of a soldier after 20 years service were $89,500, while that of a policemen and federal employee ranged between $18,300 and $24,000. The Iraq War had resulted in further increase in the emoluments of soldiers.
Taking the existing pay scales etc. and assuming that there is no upward increase for the next 25 years, if we compare the sum total of pay over the entire length of service of a civil employee till his retirement at the age of 60 years with the pay and pension of a soldier till he attains the same age, we find that the civil employee of equal status would get approximately Rs. 34 lakh more than a soldier! This monetary disadvantage works, in varying degrees, right up to the rank of Major General. Yet, the chairman of the Chiefs of Staff Committee (CCOSC) maintains that Pay Commissions, by and large, have been fair to the defence forces!