FINANCE

FINANCE GENERAL INFORMATION

Service pay is broadly based on equivalent civilian earnings (including overtime, bonuses and fringe benefits) for comparable work. No civilian occupation can be directly compared to serving in the Armed Forces, and so a Joint Services' Job Evaluation Team (JSJET), with military members trained in job analysis, constantly updates job descriptions over the whole range of Service trades. The trades are then evaluated against six factors:

The Services are then compared to the scores for civilian jobs that have been similarly evaluated. This information, together with evidence from the MOD, is presented to the Armed Forces' Pay Review Body (AFPRB).

AFPRB. The AFPRB is an independent body of distinguished men and women from public life and industry. They visit Service headquarters and units each year to assess reaction to their reports at firsthand and seek out 'grass roots' opinion on the issue of the day. They use the job evaluation scores, MOD evidence and information gathered during visits, to recommend to the Prime Minister the rates for basic and additional Service pay, some allowances and charges for food and accommodation. The AFPRB report is produced annually and the latest one may be viewed on the MOD Website.

X Factor. Services pay also includes an X-Factor determined by the AFPRB. The X-Factor is a percentage increase to basic pay, which reflects the difference between the conditions of service experienced by members of the Armed Forces and conditions in civilian life, which cannot directly be taken into account by the job evaluation process. The X-Factor compensates for such things as, for example, being subject to military discipline, liability for duty at all times, the inability to resign at will, change jobs or negotiate pay, and the danger, turbulence and separation which are part of Service life. The X-Factor also considers some of the advantages of being in the Services, such as travel, adventure, the chance to learn a trade, variety, leave and job security.

Abatement. In determining Services pay, an abatement, ie a reduction, is made to take account of the relative benefits of the Armed Forces Pension Scheme (AFPS) compared to civilian pension arrangements. This is not a direct contribution but an adjustment based on comparison of benefits.

Additional Pay. The AFPRB also recommends the rates of Additional Pay. The Job Evaluation process, which sets the rates of basic pay, takes no account of 'market forces' in the civilian job market. Additional Pay is used to encourage volunteers and to retain personnel trades where there are manning difficulties. Risk and danger may contribute significantly to the retention issue for some Additional Pay activities. The main forms of Additional Pay are Submarine Pay, Flying Pay, Special Forces Pay, Diving Pay, Parachute Pay and Loan Service Pay. These can be viewed by clicking here

Financial Retention Incentives. Financial Retention Incentives (FRIs) are a form of Additional Pay designed to target specific areas of recruiting and retention. Unit Pay Staffs have details of the rules for FRIs. Some of the FRIs can be viewed by clicking here

Accommodation Charges. If you live in Services Family Accommodation or Single Living Accommodation, you will be charged for rent and Council Tax, which will be deducted from the salary of the serving person. Changes to the cost of accommodation and garages are usually announced at the same time as changes in the military salary. In general, wherever service personnel are in the world they will pay the same for a similar type of accommodation, except for the different grading within house types. A list of the current accommodation rates and charges can be viewed by clicking here

Allowances. Allowances are not designed to provide profit or perk, nor do they exist to enhance pay by other means. Their purpose is to ensure that Service personnel receive appropriate financial recompense that recognises circumstances, which cannot be addressed in basic pay, additional pay or the X-factor. Allowances support the Armed Forces' personal strategies and focus on the individuals for who they are properly intended. They conform to one or more of the following characteristics:

To view a list of the Service allowance rates available and a brief description for each allowance, then click here