Half pay (h.p.) was a term used in the British Army and Royal Navy of the 18th, 19th and early 20th centuries to refer to the pay or allowance an officer received when in retirement or not in actual service
In 19th century militaries the half pay list served a similar function to the reserve officer components of modern day forces, with officers who were retired or otherwise not in active service receiving half of the salary of their fully commissioned counter parts. In periods of extended conflict, the half pay lists became a significant expense for militaries at the time when coupled with the selling of half pay commissions that was commonplace in the British Army.
In the Unites States this system was implemented in 1778 by the Continental Congress as an incentive to compensate for the extremely low pay that officers in the Continental Army received which made it difficult to retain officers for long periods of time. The half pay benefit was granted to all officers for seven years following the end of the revolution but was later extended to a lifetime benefit. While this benefit was promised to all officers serving in the Continental Army, following the war the Congress of the Articles of Confederation voted against paying for these pensions and so only officers from certain state regiments who had established an independent half-pay list received this pay. After extended lobbying by retired officers after the war, in 1783 Congress authorized the full pay of officers for five years to be paid by the Department of the Army. Such a large list officers drawing half-pay created similar problems for the Unites States as it had in Great Britain. In an attempt to control the growing number of aging officers still on government payroll and to promote a younger officer corps, in 1855 the Secretary of the Navy was given the right, with the recommendation of a review board, to involuntarily terminate officers who were deemed incapable or unfit for duty. Shortly following this officers with forty years of time in service were allowed to voluntarily retire. In 1889, the half pay retirement benefit was extended to enlisted personnel who had completed thirty years of active service by General Order No. 372.