ONE RANK, ONE PENSION SCHEME

Published by: DRISHTI ALAGH

I. INTRODUCTION

The One Rank, One Pension scheme came into effect starting form 1 July, 2014. The specifications of the scheme account for an equivalent amount of pension being granted to all the armed forces personnel who belong to the corresponding rank. Apart from this, the personnel must have performed their duty for an equal time frame, not taking into consideration the date when they retire. The scheme has been illustratively described further.

II. BACKGROUND

It has often been cited by a significant number of OROP protesters that shortly after the commemorated war of 1971, the Indira Gandhi government had abruptly decided to lessen the amount of pension allotted to the military personnel, dwindling the percentage by 20-40%. This pronouncement came out without any formal consultation with the Army officials or army headquarters.

Furthermore, in 2008, the Congress government decided to discontinue the system of pension based on Rank pay and launched a system of ‘Grade Pay’. This act by the Union Government tended to foster far-reaching disparities between the remunerative or pay roll of the military personnel and that of the other Civil servants as it had been marked that the other government officials, including bureaucrats and civil servants, will now be eligible for an apex scale pension, which was initially only granted to the retiring members of the army. In furtherance to this, the ‘Non-functional Financial up gradation’ (NFU) was also not made applicable to the armed forces, thus downgrading their status and widening the pension-related gap between the army personnel and other government officials.

A multitude of discriminatory acts on the part of the then Government swiftly incited an extensive thrust involving a series of country-wide protests as well as strikes with respect to the potent demand for an equivalent financial construction by the aggrieved and retired members of the armed forces belonging to almost all the ranks.

III. THE KOSHIYARI COMMITTEE

The Bhagat Singh Koshiyari Committee was set up by the government in order to tackle the demonstrations and strikes by the Army personnel. The committee involved ten members of parliament, with BJP Member of Parliament Bhagat Singh Koshiyari being the chairman. The main aims of the committee were to scrutinise and appraise the OROP issue. The committee was named after its chairman, who was a veteran Bharatiya Janata Party Member of Parliament.

In December 2011, the committee submitted its report after investigating all available evidence and taking into consideration the statements made by senior serving armed forces members, veterans and officials from the Ministry of Defence, in which the committee gave a green signal for the positive execution and enactment of the scheme.

IV. GOVERNMENT RESPONSE TOWARDS THE SCHEME

Despite the acceptance of the demand for OROP scheme by the Committee report, public commitments, including in the parliament, and visible disaffection among the army personnel, the then government was hesitant to put efforts into enacting the OROP.

Thereinafter, the government, in February 2014, assured the nation that the scheme would unambiguously be implemented in 2014-2015. However, it forgot to lay down a concrete plan as well as a budget for its successful implementation. Although an estimated of Rs. 500 Crores was laid down as the budget for implementation of the scheme, it was clearly not based on any economic or normative analysis.

Supreme Court, further ruled that Government should implement OROP in light of its 2009 judgment[1] in which SC held, “no defense personnel senior in rank could get a lower pension than his junior irrespective of the date of retirement.”

V. ENACTMENT AND ACCOMPLISHMENT OF OROP

“The government announced the application and enactment of the One Rank, One Pension scheme, with its benefits for all the pensioners and retired personnel effective from July 1, 2014.” The definition of the Koshiyari Committee was adopted and endorsed by the parliament in laying down the specifications associated with the scheme. Since then, the definition has become the basis for the ex-servicemen’s demand for the implementation of OROP. Some of the relatively striking and significant features of the scheme have been elucidated as follows:

- It was marked that the arrear amount due to the pensioners would be re-fixed on the basis of pension of retirees of calendar year 2013, benefits being applicable from July 1, 2014.

-The government also decided to set up a Judicial Committee for looking into the anomalies arising out of the application of the scheme in the country.

- Arrears were decided to be paid in four equal half yearly instalments. However, that of pensioners in receipt of special or liberalised family pension was to be paid in a single instalment respectively.

VI. ANALYSIS AND CRITIQUE OF THE SCHEME

At the same time, there have been both passionate arguments regarding the suitability of the OROP scheme and arguments opposing its applicability keeping in mind various dimensions. People in favour of the scheme tend to argue about the necessity of the scheme in mending the ever rising disparity between past and present pensioners, which has increased with every successive pay commission. On the other hand, those who oppose the scheme embrace the recommendation of discontinuing the OROP scheme put forth by the 3rd Pay Commission. Keeping in mind these arguments, the benefits and drawbacks of the scheme have been listed as follows:

BENEFITS OF THE SCHEME:

- The OROP scheme will, in a long run, act as an appropriate support system for the retired members of the army to live a dignified life as unlike other civil servants, the members of armed forces usually retire between the age of 35-40 and do not get to serve long.

- The OROP scheme is also seen as an incentive in luring the youth towards joining the Armed Forces and making it an attractive career option. Due to low salaries and pensions, people find the Armed Forces as a less lucrative career option in terms of financial prospects, further leading to a lack of manpower in the sector. OROP will thus, not only benefit the present personnel, but also the entire sector as a whole.

DRAWBACKS OF THE SCHEME:

- The fiscal load of the scheme is considered to be an enormous amount of Rs. 8,000-10,000 crores, which is further expected to rise every consequent financial year. In addition to this, as the scheme was implemented retrospectively from July 1, 2014, its arrears added to the burdening financial load.

- Furthermore, opponents of the scheme are of the view that the Armed Forces Personnel is already granted a number of allowances, namely Field Area allowance, Counter Insurgency Allowance, Special Forces Pay and so on. In addition to the several allowances made to them, they are also dedicated other significant benefits such as Subsidised foods and beverages, quotas in schools and colleges and so on.

VII. CONCLUSION

The issue of One Rank, One Pension scheme is a highly emotive one and hence, implementation must be time bound. The Government should consider OROP to premature retirees in order to keep a young army. Also representation of army personnel on the committee will go long way in bridging the trust deficit between armed forces on one hand and the Government on the other. It is true that it has great positives for the defense personnel but at the same time it has its own negatives as well as fallouts on the fiscal health and other services of the country. However, since the scheme came into effect starting from July 2014, the administrative machinery of the country has efficiently managed the fiscal burden by lucrative mobilisation of resources, which is a very positive thing to assert.

References

- Government of India, PBI (29 November 2016). "Discrepancy in rank equation between Defence and Civil Services Officers", Press Information Bureau (PIB), Ministry of Defence

- Koshiyari, Bhagat Singh, BJP, MP (16 December 2011) "Hundred and forty second report: Petition praying for the Grant of One Rank One Pension to members of the Armed Forces Personnel, (19 December, 2011)" Rajya Sabha, Secretariat.

- Union of India and Anr. v. Sps Vains (Retd.) And Ors. [2008] SC 1529

- Ministry of Defence, "Government Announces One Rank One Pension Scheme for Ex-Servicemen" Press Information Bureau, Government of India.

- "Govt. to implement OROP, pension of ex-servicemen will be revised every 5 years", The Hindu, 5 September 2015.

[1] Union of India and Anr. v. Sps Vains (Retd.) And Ors. [2008] SC 1529

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