September,5,2015: Fulfilling one of its major election promises in the run up to the Lok Sabha elections of the BJP, Defence Minister Manohar Parrikar on Saturday announced the implementation of the long delayed One Rank One Pension (OROP) for ex-servicemen.
What is One Rank, One Pension?
The ‘One Rank One Pension ’ rule means that retired soldiers of the same rank and length of service will receive the same pension, regardless of when they retire. So Two military personnel who retired after equal length of service in same rank get equal pension.
Any hike in pension rates to be automatically passed on to past pensioners.
Payment of uniform pension to military personnel irrespective of date of retirement.
As of now, the date of retirement determines the amount of pension. With each Pay Commission coming up with its recommendations every 10 years, the military veterans who retire early, receive less pension as compared to those who retired later with the same rank and length of service.
Under OROP, a sepoy who retired in 1995, for instance, would get the same amount of pension as the one who retired in 1996.
One Rank, One Pension reform would allow the General who retired in 1980 receive the same pension as a General retiring in 2015 serving the same number of years in the army. This is especially needed in the military where soldiers retire far younger and could neither easily switch to other careers nor get a living wage from the pension.
So far so good. What is the glitch? In fact, the OROP existed until 1973. The glitch is that it requires a lot of money [Rs 8300 crores/year and upwards]. For every pay increase to the existing forces, all past pensioners also have to get a rise. As Indians live longer this means the government has to pay pensions to each person for decades and at rates fast increasing. And more. When it is implemented for the military, the other government employees, starting from the paramilitary, are also going to ask for it. Given that it involves a few thousand crores, every government is dragging its foot.
Who will benefit from OROP?
Ex-servicemen drawing pensions will benefit from the OROP scheme, especially those who retired before 2006. Why? Because at present, pensioners who retired before 2006 draw less pension than their counterparts and even their juniors. The scheme will benefit all three services — air force, navy and army.
How much will the OROP scheme cost the government?
The United Progressive Alliance government in their interim budget had announced an amount of Rs 500 crore for the scheme. However, NDA’s Finance Minister Arun Jaitley in his Budget announcement allotted Rs 1,000 crore for the scheme.
Why has there been so much delay in implementing OROP?
Officials within the ministry of defence have been against the implementation of OROP, citing financial, administrative and legal impediments.
In 2011, the Department of Ex-Servicemen Welfare of the MoD pointed out to a parliamentary committee that OROP was not feasible to implement since documents of military personnel are weeded out after 25 years — which is not true.
In reality, the Pension Payment Orders of pensioners, which contain all relevant details such as the rank last held and the length of service, are retained during the lifetime of each pensioner and then during the lifetime of the family pensioner in case of his demise. Further, all these details are available in a document called ‘Long Roll’ which is maintained in perpetuity in terms of Regulation 592 of the Regulations for the Army.
Another reason given by those opposing the scheme was that “other employees” would also start demanding OROP.
When did OROP become a reality?
After several protests and demands, the Manmohan Singh government towards its fag-end agreed in principle to clear the scheme in 2013. Realising the importance of correcting the wrong, the Narendra Modi government and the prime minister himself gave renewed hope to the veterans by announcing the implementation of the OROP scheme “as soon as possible”.
On April 9, Defence Minister Manohar Parrikar said, “All hurdles, including a political clearance on its financial implications, have been removed. Now the actual calculation and administrative details are being worked out. We are sure to get the scheme rolling in the next few weeks.”
Know the Complete Story
One Rank, One Pension (OROP), was the basis for determining the pension and benefits of Indian Armed Forces till 1973.
In 1973, the Indian National Congress (INC) government headed by Indira Gandhi, Prime minister, following the Third Central Pay Commission (3 CPC), in an “ex-parte” decision terminated OROP. The termination of OROP caused disquiet in the Armed Forces and has since become a cause of public protests by Armed Forces Veterans.
An all party ten member Parliamentary Panel, known as the Koshyari Committee after its Chairman, a veteran member of the BJP, examined the issue of grant of OROP to Armed Forces Personnel and submitted its report on 19 December 2011. The Koshyari Committee unanimously found merit in OROP and strongly recommended that, “Government should implement OROP in the defence forces across the board at the earliest and further that for future, the pay, allowances, pension, family pension, etc in respect of the defence personnel should be determined by a separate commission so that their peculiar terms” are properly taken into account. The Koshyari Committee blamed bureaucratic resistance and apathy for the failure to implement OROP.
What the Koshyari Committee ruled
The Koshyari Committee definition of OROP was accepted by the UPA Government, endorsed by Parliament, and by Ex Servicemen and Ex servicemen organizations. It has since become the basis for the Ex- Servicemen demand for implementation of OROP. It is in sync with the Ex-servicemen definition of OROP, according to which OROP “implies the grant of equal pension to soldiers of a particular rank, who have rendered the same length of service, irrespective of the date of their retirement.”
In the run up to the Indian general election of 2014, OROP became a politicised issue.It was an integral part of the election manifesto of many political parties including the INC and the Bharatiya Janata Party (BJP) Both Sonia Gandhi of INC, and Narendra Modi of BJP, at political rallies made repeated commitments to implement OROP, if elected.
While the Central government wanted 2011 as base year for implementing OROP, the ex-servicemen wanted the base year as 2014. Now the government has agreed to take 2013-14 as the base year.
Ex-servicemen want revision every year or at least once in two year but the government in in favour of doing it just once in 5 years. This is the biggest hurdle at present.
Ex-servicemen have already compromised on some sticking points. They have agreed to a revision once in two years. Retired Havaldar of Army and equivalent ranks in the Navy and IAF, and lower ranks along with war widows will be given cash.
Personnel who retired as an officer will get bonds with 6% interest. The defence veterans can also accept relaxation of upto three months.
Partial acceptance by BJP Govt-
Today ie on 5 September 2015, Defence Minister Manohar Parrikar has announced that Govt. has accepted the concept of OROP & will be going to implement. In a statement issued by Defence Minister, he said “Despite huge financial burden, the government has taken a decision to implement the One Rank One Pension.Benefit of OROP will be given with effect from July 1, 2014, a date immediately after the present government assumed office”. Govt. has accepted all demands of veterans except annual revision of Pension. Govt has decided to revise the pension after every five years. Also,OROP arrears are to be paid in four half-yearly instalments; all widows, including war widows, to be paid arrears in one installment. To begin with, OROP would be fixed on the basis of calendar year 2013. Pension will be re-fixed for all pensioners retiring in the same rank and same length of service.
The Government is considering appointing a committee under a judge to go into the issue of equalization of pension, a leader of the ex-servicemen group fighting for One Rank One Pension said after a meeting with Defence Minister Manohar Parrikar.
The estimates of expenditure on account of OROP has undergone many revisions: according to early MOD estimates OROP was expected to cost ₹ 3000 crores, this figure has since been questioned and revised. The current estimates vary between ₹8,000-9,000 crores Finance Ministry estimates for implementation of OROP in accordance with the accepted Koshiyari definition, according to media reports in August 2015, were about ₹ 12000 crores , ie, about ₹ 4000 crores more than estimated earlier.
IAS officers already getting OROP-
All officers of Civil services, who retire at the apex scale, i.e., the highest scale of pay in the Government of India, which is currently Rs. 80000(fixed), are covered by One Rank One Pension (OROP). According to former officer of the Indian Administrative Service, who retired at the apex grade, and is recipient of Apex Grade OROP linked pension, all officers, ie, 100 percent Indian Administrative Service (IAS), and Indian Foreign Service , Indian Forest Service(IFS) etc. retire at Apex pay grades, not with standing what their responsibilities or duties entailed. The OROP for the Civil services, was achieved slyly, by “a slight of hand”, by a decree, “that all who retire in this scale (known loftily as the Apex Scale) would get OROP – that is, their pensions would always be linked to whatever revised Apex Scale the subsequent Pay Commissions decided. Since every single IAS (or IFS) officer retires in the Apex Scale this forever ensured OROP for themselves. To reduce any opposition to the stratagem, some Apex Scale posts were also made available to other All India services.” The award of OROP to officials of the Civil services,is the “causus belli” for the protest over One rank One Pension (OROP) by the Veterans of the Armed Forces of India.
Supreme Court and High Court Judges too now have OROP-
Supreme Court ruled that the anomaly as per which High Court judges selected from the Bar get lesser pension than those elevated from state judicial services, deserves to be removed.Accordingly the government had to bring a bill to amend the law governing their salaries and service conditions. The proposal to amend the High Court Judges (Salaries and Conditions of Service) Act, 1954, comes more than a year after the Supreme Court ruled that such a discrepancy must be removed.
The Law Ministry plans to bring the bill soon. According to an apex court ruling, if the service of a judicial officer is counted for fixation of pension, there is “no valid reason” as to why the experience at Bar cannot be treated as equivalent for the same purpose.
“…we accept the petitioners’ claim and declare that for pensionary benefits, ten years’ practice as an advocate be added as a qualifying service for judges elevated from the Bar.” The apex court ruling delivered by a bench headed by then Chief Justice of India P Sathasivam on March 31, 2014 had also said that “one rank one pension must be the norm in respect of a Constitutional office.”
SC ordered One rank, One pension for HC Judges, Govt to amend Law