Saturday, September 5, 2015

OROP - An honourable way out : By Nitin Gokhale

After months of deliberations, the Government has finally accepted that the One Rank One  Pension (OROP) principle will be implemented with effect from 1 July 2014 fulfilling almost 98 per cent of the demands made by military veterans for the last several months. Under the formula worked out by the government, soldiers, widows and those with disabilities will stand to get the maximum benefit. While the solution does not meet the principle in toto, it comes as close as practically possible in giving the veterans what is rightfully theirs.  

Although the veterans have been demanding equalization of pension every year, the government has decided to undertake the revision every five years. This is seen as a compromise between the demand of the veterans (who wanted equalization every one year) and the principle of doing the equalization from Pay Commission to Pay Commission (every 10 years), advocated by non-MoD mandarins in the government. This way pensioners would not lose much in monetary terms since a payout every year would have resulted in only about Rs 100 crores extra for 25 lakh veterans in a year in addition to the amount that has been sanctioned now. 

Although the sum involved is small calculations every year were seen as cumbersome and complicated. Under the government's proposed formula, each jawan is likely to see an enhancement of at least Rs 3,500 per month in his pension while officers will most probably draw Rs 7,500 to Rs 8,000 more per month. While there will be some dissenting voices for sure, majority of the veterans are likely to accept the government's formulation. 

To understand the origins of the demand for One Rank One Pension, one has to go back to 1973 when 3rd Pay Commission equated the pay and allowances of the armed forces with that of civilian employees in the government without taking into consideration the fact that 90 per cent of the military personnel retire from service at an average age of 35 to 37 years. This early retirement deprives them of full pay and perks for nearly 25 years as compared to their civilian counterparts who retire between 58 and 60 years of age.

For nearly four decades (1973 to 2010), no government paid heed to this anomaly. After ex-servicemen started demanding One Rank One Pension (which in essence means paying same amount of pension to persons retiring in the same rank with equal length of service) with renewed vigour in 2010, the UPA government after much reluctance accepted the report of the Bhagat Singh Koshiyari Committee which recommended the principle of One Rank One Pension in December 2011.

Based on the Committee’s report, the government calculated that Rs 1300 crores will be required to pay the arrears for OROP in 2011-12. In 2013-14, the government enhanced the amount to Rs 1573 crores. Mr P. Chidambaram, the then finance minister, in his interim budget speech on 17 February 2014, granted Rs 500 crores (based on the estimate of Rs 1573 crores) for the year 2014-15.

During the election campaign for 2014, when the BJP supported the principle of OROP, it was based on the assumption that the amount required would be in the range of Rs 1,000 to Rs 1500 crores. Accordingly, Mr Arun Jaitley, as finance minister, also granted Rs 1000 crores in the first budget of the present government. However, when the Ministry of Defence (MoD) actually got down to calculate the amount required to make the payment for OROP in 2014-15, it was realized that the amount required would be in the vicinity of Rs 8,000 crores annually.  That is where the government begun to have second thoughts but thanks to the sustained pressure by the veterans and the realisation that the promise made by Prime Minister and Defence Minister needs to fulfilled at any cost, the government has finally decided to implement the OROP.

It has taken months of detailed study and negotiations to arrive at a solution that should satisfy the majority of ex-servicemen in the country.​

In sum, by implementing the OROP scheme, the NDA Government is finally on the verge of  finding a solution to a four decade old problem left hanging by successive governments. With majority of their demands being fulfilled under this formula, the veterans have much to celebrate today. For the remaining minor anomalies, the government may think of appointing a review committee. 

(Source- ABP News) 

No comments:

Post a Comment