When selecting personnel of the Armed Forces for compulsory redundancy no consideration was given to the proximity of the immediate pension point. As we reduce the size of the Armed Forces, our priority is to ensure that the services maintain the correct balance of those skills and experience, across the rank structures, which are required to deliver operational capability now and in the future, and it is this which has determined the redundancy fields.
The Armed Forces redundancy schemes pay significantly larger tax free redundancy compensation lump sums to those who narrowly miss out on immediate incomes. Any pension rights that have been earned will also be preserved, meaning that an index linked pension and further tax-free lump sum become payable at age 60 or 65, depending on pension scheme.
Whereas the majority of other ranks normally have to serve for 22 years before receiving an immediate income, the Armed Forces redundancy schemes reduce this requirement to 18 years. This is a concession of four years, which will enable many redundees to receive an immediate income for which they would otherwise not have qualified.