§ Mr. CohenTo ask the Secretary of State for Defence what information he has on the rights to redundancy payments of soldiers in(a) the British Army and (b) each of the armies of the other North Atlantic Treaty Organisation member states.
§ Mr. Archie HamiltonSoldiers made redundant with less than 22 years, but at least 12 years service from age 18, will receive an immediate pension calculated as a proportion of the 22 years rate based on their length of service and rank held. They will also receive a tax-free terminal grant of three times the annual rate of pension. In addition, special capital payments of up to 18 months' pay are also payable, related to the length of service and annual rate of pay. These payments are also tax free.
Soldiers with less than 12 years' service will receive a special capital payment of up to 19 months' pay based on their years of completed service and annual pay. If they have more than two years' service, they will also be awarded a preserved pension and terminal grant of three times the rate of pension payable at age 60.
My Department has little information on redundancy payments made to the forces of the other North Atlantic Treaty Organisation member states. Many of the European nations have conscript armies. In the American army, I understand redundancy payments are made to service personnel with between six and 18 years' service. Payment equates to one tenth of the annual basic salary for each completed year of service, and is taxable. Service of less than 20 years does not qualify for any form of pension. Personnel with 20 or more years service receive a pension. Anyone with 18 years of service is allowed to serve on to the 20-year point to qualify for a pension.