One Rank One Pension Scheme

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One Rank One Pension Scheme is the new pension scheme for the Indian Armed Forces. It was announced by the Bharatiya Janata Party (BJP) led National Democratic Alliance (NDA) Government on 5 September 2015, after protracted nation wide protest by armed forces veterans.^[1][2] The implementation tables of the scheme were issued in February 2016.^[3]

The Government decision to implement One Rank One Pension (OROP) unilaterally, was greeted with dismay and disappointment by the leadership of the OROP and Indian Ex Servicemen Movement, who decided to continue with their protest.^[4][5][6] The veterans protested that the one rank one pension scheme implemented by the government does not conform to the 'accepted' definition of OROP and is marred by several anomalies.^[7] On 5 February 2016, they said, that the “OROP tables short-change widows, reservists, battle casualties, havildars, subedars and subedar majors."^[8]

Background

Armed Forces pension in India have been a contentions issue since 1973, when the Government, without discussion with Armed Forces headquarters or veteran representatives, drastically reduced armed forces pensions.^[9][10] The demand by the armed forces and protests by veterans for OROP was provoked, among other factors, by

[a] Increasing asymmetries between the armed forces pay and pensions and defence civilians and the police officers, following the Rajiv Gandhi Government to implement rank pay mechanism in 1986; which debased armed forces ranks, pay, and pensions; and,

[b] The decision by Manmohan Singh led UPA Government in 2008, to create hundreds of new posts of Secretaries, Special Secretaries, Director General of Police (DGP) at the apex grade pay level to ensure that all police officers retire at at the highest pension scale; and reward all civil services including the Indian Police Service(IPS) with Non-functional financial up-gradation' (NFU).^{[11] :para 1.2.8–9,11.20,}

These government decision fuelled the perception among veterans of government neglect. Starting 2008, veterans launched public protests, including hunger strikes, against government pension policy for the armed forces. The goal of armed forces veterans' protest under the banner of One Rank One Pension, which had wide-support, was to ensure equity with civilian and police pay and pensions and protection of armed forces pay and pension against government inattention and neglect.^{[12][13]:p 1[14] [15]}

Issues

Estimated expenditure

The estimates of expenditure on account of the new pension scheme, called OROP, has undergone many revisions: according to early Ministry of Defence (MOD) estimates OROP was expected to cost ₹ 3000 crores;^{[14]:para 6, 6.11} This figure was questioned and revised, in 2011, to between ₹ 8,000-9,000 crores.^{[14]:para 7} Ministry of Finance estimates for implementation of OROP in accordance with the accepted Koshyari definition, in August 2015, were about ₹12000 crores ,i.e., about ₹ 4000 crores more than estimated earlier.^[16] In September 2015, the estimated expenditure, according to the Defence Minister was "₹ 8,000 to 10,000 crores at present".^[1][2]

Affordability

In the absence of accurate estimates of the expenditure on the new pension scheme for the armed forces, its affordability became a moot point: defence analyst noted that OROP is affordable, and opposition dismissed it as 'specious'.^[17] Former heads of Armed Forces including Admiral Arun Prakash said that OROP is affordable as it is small fraction of the defence budget.^[4]

OROP and premature retirement

Defence Minister's decision to include the clause "Personnel who voluntarily retire will not be covered under the OROP scheme" in the OROP scheme announcement, on 5 September 2015, without warning the ex-servicemen, caused immediate outrage, and doubts about government intent amongst ex-servicemen.^[18][19] Arguing against the exclusion clause the ex-servicemen have said that it was not a part of the discourse, and discussion between the ex-servicemen and the government; it was not an items on the discussion agenda on 5 September morning meeting between minister and ex-servicemen; voluntary retirement scheme(VRS) is a term used by Public Sector Units, and corporate sector, to retire their staff on mutually agreed package, which usually does not have a pension component; and that VRS is not applicable to the Armed Forces, as the Armed Forces does not have VRS. Ex-servicemen have explained that the armed forces has premature retirement (PMR), which is different on many counts from VRS: to avail pension and PMR, Armed Forces officers must have completed 20 years of service, and soldiers 15 years service; and unlike VRS, PMR invariably has a reserve liability, i.e., they can be ordered back into service by the government if the national situation so demands. Ex-servicemen were surprised and disappointed that MOD, which oversees PMR, included, at the last minute, and without warning, the exclusion clause.^[19] They were also disappointed that the MOD conflated VRS and PMR in its announcement. Who was behind the confusion is unclear. The ex-servicemen have demanded an inquiry on how the offending caveat was slipped into the Ministers statement, and MOD press release.^[18] To defuse the ex-servicemen suspicion, distrust, and prevent further escalation, the Prime Minister, on 6 September, announced in Faridabad that all pensioners including those who took premature retirement will be covered by the OROP scheme.^[20][21] It is estimated that 46 per cent of all ex-servicemen are PMRs.^[18]

Judicial Commission

OROP is not a settled issue. It is, as MOD statement notes, 'a complex issue' and 'not an administrative matter alone', and therefore the MOD has decided to constitute "a One Member Judicial Committee", which will do a "thorough examination of interests of retirees of different periods and different ranks" and consider "inter-service issues of the three Forces".^[2] The report was scheduled to be released in six months". Ex-servicemen rejected MOD decision to constitute a one-man committee headed by a retired Supreme Court justice. Instead they urged the Government to constitute a committee of three military veterans, recommended by ex servicemen and an official, appointed by MOD, and that the committee be called upon to submit its report not in six but one month.^[5]

One of the main issues perceived as a limitation on the efficacy of the Judicial Committee, is the language of the Govt notification dated 14 December 2015. It does not specify how affected veterans can approach the Committee for redressing anomalies in OROP implementation. The notification merely mentions how the Judicial Committee would make recommendations based on references received from the Government. The general perception is that as anomalies result from the manner in which OROP has been implemented by the Government, the Government itself is unlikely to view these as anomalies.

Veterans Response

Following the Manohar Parrikar statement on the decision to implement OROP, Major General (Retd) Satbir Singh said, "Out of the six demands that we made, the government has only agreed with one. We want clarification on the premature retirement point in the OROP." On Government decision to revise pension every five years rather than every year he said, that this was not "in the spirit of One Rank, One Pension, it will be One Rank, Five Pensions," and therefore urged "the government to rethink it".^[4][5]

The ex servicemen dissatisfied with the OROP scheme announced by MOD, decided to call off the hunger strike, but continue with the protest till "all major demands are met". To press their demands a maha-rally was held on 12 September 2015.^[4][5]

Political response

A.K. Antony, former defence minister in UPA Government, on 5 September 2015, calling the BJP government OROP scheme "totally disappointing", said it "substantially diluted the provisions of the OROP announced by the UPA". He said, it "ridiculed the ex-servicemen as well as the whole country." Refuting Manohar Parrikar's allegation that Congress Government was ambivalent on OROP, he said, "We had already accepted in toto the demand for OROP and were in the process of implementing it."^[22]

Chronology

5 September 2015

Manohar Parrikar, Defence Minister, in the presence of the three Chiefs of the Armed Forces, on the 83rd day of the nationwide protest by ex-servicemen, announces that "despite the huge fiscal burden", Narendra Modi, the Prime Minister, "has fulfilled his commitment and approved OROP for Armed Forces personnel."^[1][2]

7 November 2015

Department of Ex-Servicemen Welfare, Ministry of Defence, as follow up to the 5 September announcement,^[2] issues order on "One Rank One Pension (OROP) to the Defence Forces Personnel", which were delayed on account of the elections in Bihar. The OROP order excludes all future Armed Forces retirees who take premature retirement from OROP entitlement.^[23]

3 February 2016

A Ministry of Defence press release says the Government has fulfilled OROP, a 'demand of the Defence Forces personnel'.^[3] Department of Ex Servicemen issues detailed letter on the implementation of OROP, including table for calculation of pension.

8 February 2016

The veterans disappointed with government response decide on challenging "the government in a court of law for OROP".^[24][25]

See also

• One Rank, One Pension
• Koshyari Committee Report On Grant Of One Rank One Pension
• Pay Commission
• Sixth Central Pay Commission

References

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