Friday, December 5, 2014
OROP - The endless discussion
Notwithstanding acceptance of OROP in principle by both the UPA and NDA Governments and allotment of funds as well, the comments by Mr A Jaitley and Mr M Parrikar and the answer to a question, raised recently in the Rajya Sabha, raise a doubt, if the intention of the present Government is to honor their commitment or to try to get away with another enhancement of pension for pre certain-cut-off-date veterans. Strangely, though quite a few of us are absolutely clear as to what OROP means in terms of quantum of pension to each veteran, there are more number of veterans who have just a vague idea of OROP concept and might be very happy with some enhancement; the enhancement may not even be decent enough.
2 Risking adverse criticism of boring the few well versed veterans, I make an attempt to spell out the issue. Mr Jaitley feels that the issue of OROP is complicated and needs a research by a tribunal. Mr Parrikar, fortunately, feels that it is just dynamic in the sense that the pension needs to be revised every year. Unfortunately, he seems to be unhappy about it. I do not know why. My question is “so what if it is dynamic; let it be revised every year, now that both the Governments have accepted the definition, in principle”. Mr Parrikar is wrong in his assumption that the pension needs to be revised every year. And equally wrong is Mr Jaitley in his assumption that OROP is complicated.
3. The method of calculations Let’s see what are the steps involved in the implementation of OROP
(a) Existing Pension Order indicates the rank of the veteran and the Qualifying Years of Service, on his retirement.
(b) It is a fact that veterans retiring during Jul 2015 to Dec 2015 stand to get the highest pension in comparison with those who retire earlier in the same rank and with same or more qualifying years of service.
(c) The decision has been taken to fix the pension of veterans initially at par with the maximum pension earned by the recently retired veteran as on Apr 01, 2014. The pension calculated as on that date would be lesser than the pension indicated in Para (b), above.
(d) Thus it warrants that the pension determined as on Apr 01, 2014 has to be suitably incremented as and when the higher pension is sanctioned for those veterans retiring subsequent to the date Apr 01, 2014, to honor the commitment of both the Governments to the definition of OROP.
(e) This does not mean that the pension needs to be revised every year. It only means that the pension sanctioned as on Apr 01, 2014 needs to be incremented on Jul 01, 2014 by an amount equal to 3% of the amount of the pension as on Apr 01, 2014 minus half the MSP entitlement to that rank, Jul 01, 2014 is the date when increment is granted to serving soldiers of any rank, thereby raising the pension higher than what was on Apr 01, 2014.
(f) Obviously similar increment has to be granted in the year 2015 as well. Further increment may not be necessary as 7CPC will recommend suitable policy on pension for the future from 01 Jan 2016 onwards.
4. Now, can anyone see any complication in the implementation or the necessity to carry out yearly revision? If the Accounts people see so, I am afraid that they do not deserve to manage our pension accounts. Some of us may be employed on contract basis, just for a couple of months. We may even opt to serve with no remunerations whatsoever.
5. What is the Administrative work?
(a) First, Government letter has to be issued to the effect that the Government has accepted to regulate the pension of all veterans as recommended by the Petition Committee and instruct the Pension authority to implement the pension provisions as per the definition.
(b) Second, Pension Authority needs to issue to circular stipulating the pension as on 01 Jan 2014.
(c) Third, Pension Authority must stipulate the maximum possible pension (as given in Para 2(b)) and corresponding minimum QYS applicable.
(d) Fourth, a clause for incrementing on Jul 01, 2014 and Jul 01, 2015 must be stipulated authorizing the PDA to carry out the incrementing without referring the matter to any or awaiting any instructions, subject to the condition that the maximum possible pension should not exceed the stipulated amount and the QYS must equal or more than the corresponding figure (Ref (c) above).
6. I have attached three files for those who would be interested in detailed analysis and efforts.
a. First a paper that covers comprehensively the concept of OROP (Not attached here)
b. Second a letter to PM explaining the simplicity of implementation of OROP (Not attached here)
c. Third copy of letter to RM requesting him to rise up to the occasion and improve the concept of OROP by restoring the edge the three Chiefs enjoyed in their pension, to the extent possible. The least that can be done is to ensure that the pension of the three Chiefs is 33.33% more than the highest pension, payable to the civilian for all times to come. And link up the maximum permissible pension for all other ranks to the pension of the Chiefs, again for all time to come, so that there is no need for revision of pension as a independent exercise giving scope for adverse manipulations. (Not attached here)
Maj Gen RN Radhakrishnan
(Source- India of my Dreams blog)