The Armed Forces Pay Review Body, covering about 267,000 men and women, recommended rises ranging from 3 per cent to 4.4 per cent from April. But it was the only group refused the full rise by the Cabinet.
The Prime Minister said yesterday the Government believed that the recommendations were 'too high to be implemented in full' from 1 April. All ranks were awarded 2.7 per cent from April with the balance paid from 1 January 1995, adding about pounds 170m to the pay bill.
Malcolm Rifkind, the Secretary of State for Defence, who will be visiting Bosnia on Sunday, believes the pay award will lift morale, in spite of the delay in paying part of the award.
Mr Rifkind has been forced by the Treasury, like other departments, to find the money from within his budget. The pay increases will be met by savings achieved by the new review of defence, called Front Line First, intended to reduce the size of back-up forces.
The cuts could include the royal yacht, which falls on the defence budget. However, the review body's recommendations also assume increases of 5 per cent in rental charges for accommodation, yielding an extra pounds 7.7m.Reuse content