I am today announcing the Government’s decision on pay for the Armed Forces for 2023-24.

The Government recognises that Armed Forces personnel continue to work with great professionalism and personal sacrifice to protect the nation, securing our allies, supporting Ukraine and aiding our own civilian authorities. On the 19 June 2023 the MOD published “Agency and Agility: Incentivising people in a new era. A review of UK Armed Forces incentivisation by Rick Haythornthwaite”. Whilst MOD is still studying the report’s recommendations, it provides a compelling vision for improving the proposition to those who serve and those who may consider serving in the future.

In the meantime, the 2023 pay award plays a vital role in continuing to support retention and wider recruitment for a smaller but increasingly highly skilled Armed Forces, whilst ensuring this is affordable within the context of broader Defence priorities.

The Government received the Armed Forces’ Pay Review Body (AFPRB) report on 2023 pay for Service Personnel up to and including 1-star rank on 25 May 2023. This has been laid before the House today and published on GOV.UK. The Senior Salaries Review Body’s (SSRB) 2023 report which includes recommendations for the senior military has been laid today by my colleagues in the Cabinet Office.

The Government values the independent expertise and insight of the AFPRB and the SSRB and takes on board the recommendations outlined in the report.

The Government is accepting the AFPRB’s and SSRB’s recommendations in full for the 2023/24 Pay Round. Building upon the 2022/23 pay award, which was the biggest percentage uplift in 20 years for Service Personnel, this year’s pay award goes beyond that level, rightly recognising the vital contributions of Service Personnel in the interests of the nation, as well as the ongoing cost of living pressures facing service households.

The headline award recommended by the AFPRB is for a consolidated increase in base pay for all members of their remit group (including Medical and Dental officers up to and including three-star) of 5% plus a further consolidated increase of £1,000 for all full-time UK Regular personnel with a pro-rata increase for other cohorts in their remit group. The Government is accepting this recommendation in full.

This approach rightly targets the highest pay increases towards our junior Service Personnel, providing effective pay increases of between 9.7% for the most junior ranks and 5.8% for officers at one-star rank.

The SSRB have recommended that all members of the senior military (two-star rank and above), should receive a 5.5% consolidated increase to base pay. The Government is accepting this recommendation in full.

The Government is partially accepting the AFPRB’s recommendations on charges for accommodation. The AFPRB recommended a 4.5% increase to the top level of Service Families Accommodation (SFA) and Single Living Accommodation (SLA) charges. The Government accepts the AFPRB’s recommendation for SLA charges. However, SFA Charges will remain fixed at the 2022 rates throughout FY23/24 and not be increased in line with the rental element of CPI as expected. This decision has been taken by the Defence Secretary in recognition of the significant underperformance of the Future Defence Infrastructure Services (FDIS) Accommodation delivery contract since its introduction in April 2022.

In addition to the pay award, the MOD has continued to freeze the daily food charge for our personnel, and the availability of free wrap-around Childcare is increasing across Defence with families able to save around £3,400 per child per year. Any service families facing hardships, of any kind, should approach their welfare officer so that further support can be discussed.

Whilst both pay awards are above the MOD’s original levels of affordability, this pay award has been made affordable by reprioritising spending within the existing Defence budget, ensuring that we continue to recognise that our people are our most important asset. It is affordable in the context of the Spending Review 2020 settlement which saw a £24bn cash increase to the defence budget, the largest sustained increase since the Cold War, and the further £5bn over the next two years provided at Spring Budget 2023. It is consistent with the Government’s priority to halve inflation.

The complete recommendations of the AFPRB for Pay Round 2023 are as follows:

• A headline consolidated increase in base pay for all members of their remit group (including Medical and Dental officers) of 5% plus a further consolidated increase of £1,000 for all full-time UK Regular personnel with a pro-rata increase for other cohorts in their remit group.

• Officers Commissioned from the Ranks (OCFR).

Agreed to MOD’s proposals for OCFR pay from 1 April 2024:

• Introduction of a two-year pay dwell on commissioning, mirroring that required under Pay 16 for Direct Entry officers moving from OF1 to OF2;

• Reduction of the minimum pay rise on promotion from OF2 to OF3, from 5% to 2%, mirroring wider policy and reducing the standstill period required by some who promote above increment level OF3-01; and

• To re-establish a more cost-effective bridge following Pay 16 changes, cut the uppermost OCFR pay increment (increment 15), and introduce five new OCFR pay increments below increment 1, creating a new 19-increment OCFR pay spine.

• Cyber.

• Agreed to the introduction of competence-based cyber payments from 1 April 2023 at the following levels: Level 2 £6,000; Level 3 £15,000 and Level 4 £25,000.

• Recruitment and Retention Payments (RRP).

• Agreed with MOD’s proposals to increase Levels 1 to 3 of RRP (Hydrographic) to £4.04, £6.60 and £7.63 respectively (Levels 4 to 6 are unchanged) and to bring forward the next review of the RRP.

• Agreed with MOD’s proposals to increase the Initial and Enhanced rates of RRP (Mountain Leader) to £19.85 and £23.75 respectively.

• That the following rates of RRP should increase by 5.8% from 1 April 2023 in line with the main pay award recommendation: RRP (Flying), RRP (Flying Crew), RRP (Diving), RRP (Submarine) (including Submarine Supplement and Engineer Officers Supplement), RRP (Nuclear Propulsion), RRP (Special Forces), RRP (Special Forces Communications), RRP (Special Reconnaissance), RRP (Special Intelligence), RRP (Special Communications), RRP (Parachute) (including RRP (High Altitude Parachute), RRP (Parachute Jump Instructor), RRP (Explosive Ordnance Disposal), RRP (Weapons Engineer Submariner), RRP (Naval Service Engineer) and RRP (Nursing).

• Compensatory allowances.

• All rates of compensatory allowances should increase by 5.8% with effect from 1 April 2023, in line with the main pay award recommendation.

• X-Factor.

• No change to the rate of X-Factor at 14.5%.

• That the rates of X-Factor for Service Personnel of OF5 and OF6 rank, Regular personnel on Flexible Service, Full Time Reserve Service of all commitments, Part Time Volunteer Reserves and Military Provost Guard Service are unchanged.

• That the rates of X-Factor for the Royal Gibraltar Regiment Regulars should increase from 6.5% to 11.5%.

• That the rates of X-Factor for Royal Gibraltar Regiment Reserves should increase from 3.25% to 5%.

• Volunteer Reserves Training Bounty.

• That the rates of the Volunteer Reserves Training Bounty should increase by 5.8% from 1 April 2023 in line with the main pay award recommendation.

• Defence Medical Services – Pay for Medical and Dental officers (MODO).

• A consolidated uplift of 5% for all ranks within the MODO cadre, with a consolidated increase of £1,000 for all full-time UK Regular personnel and a pro-rata increase for other cohorts from 1 April 2023.

• Agree in principle to the introduction of a bespoke pay spine for Allied Health Professionals in the initial Unified Career Management group (degree and diploma qualified), targeted for implementation in January 2024, in conjunction with changes to terms and conditions.

• That the value of Clinical Excellence Awards should increase by 5.8% from 1 April 2023 in line with the main pay award recommendation.

• Accommodation charges.

• That Service Family Accommodation (SFA) Combined Accommodation Assessment System Band A charges should increase by 4.5% (in line with the CPI Annual Rents for Housing Component at November 2022) from 1 April 2023. This recommendation would affect the rents of lower bands differently, as they are set in in descending increments of 10% of the Band A rate.

• This recommendation is not being accepted and instead SFA charges will be frozen at 2022 rates.

• That furniture charges (for all SFA types) should increase by 4.5% (in line with the CPI Annual Rents for Housing Component at November 2022) from 1 April 2023.

• This recommendation is not being accepted and instead charges will be frozen at 2022 rates.

• Single Living Accommodation (SLA) rental charges for Grade 1 should increase by 4.5% from 1 April 2023, with increases of 3% to Grade 2, 1.5% to Grade 3 and no increase to Grade 4 accommodation.

• That charges for standard garages and carports should increase by 4.5% from 1 April 2023, with no increases for sub-standard garages and substandard carports.

• This recommendation is not being accepted and instead charges will be frozen at 2022 rates.

The SSRB have recommended the following:

• That all members of the senior military should receive a 5.5% consolidated increase to base pay.

• That there should be no change to the current pay arrangements for Medical Officers and Dental Officers (MODOs):

• Two-star MODOs should continue to be paid 10% above the base pay at the top of the MODO 1-star scale, plus X-Factor.

• Three-star MODOs should continue to be paid 5% above the base pay at the top of the MODO 2-star scale, plus X-Factor.

In the last five years the Armed Forces have received a cumulative pay award of 14.9%. It is hoped that, combined with the 33% of Service Personnel also benefiting from incremental pay rises, the increase to starting salaries (after training) to £23,496 and the freeze on SFA and food charges, , this represents a fair settlement for the Armed Forces and demonstrates how much the Government values their service and families.

Armed Forces' Pay Review Body (pdf, 1688.9KB)