UPDATE ON OROP

OROP Status Report

by Lt Gen Raj Kadyan

General

1.      Politicians speaking in the Parliament add a lot of dressing to the substance of what they say. The Finance Minister did the same on 14.02.2014 while speaking on OROP. He first floridly announced that the gap between pre-2006 and post-2006 retirees for all ranks needs to be closed. Later, coming to the gist he had stated that the government has now decided to walk the last mile and implement the scheme of One Rank One Pension for all Armed Forces personnel and their dependents.

2.    In the follow-up meeting held on 26.02.2014 the Defence Minister, who was in chair, had reiterated the following definition of OROP:

       "OROP implies that uniform pension be paid to the Armed Forces personnel retiring in the same rank with the same length of service irrespective of their date of retirement and any future enhancement in the rates of pension to be automatically passed on to the past pensioners. This implies bridging the gap between the rate of pension of the current pensioners and the past pensioners, and also future enhancements in the rate of pension to be automatically passed on to the past pensioners."

3.   This definition accords with what the IESM has been projecting (except we had not used the term 'uniform pension'). This was also the definition given by the Rajya Sabha Committee  on Petitions that submitted its report on 19.12.2011.

4.    The Services prepared a draft government letter in April giving out detailed modalities of OROP. The draft still remains under discussion.

Meetings of Stake Holders

5.      In a subsequent meeting held on 22.04.2014, the Defence Minister constituted a committee to work out the modalities and submit its report within three weeks. (It is learnt that the Minister wanted the report much faster but the PCDA expressed inability to do it in lesser time frame).

6.    The Committee has had five sittings starting with the first meeting on 02.05.2014. Some of these were chaired by the RRM.  The PCDA has been consistently displaying an obstructionist approach and has been the main stumbling block. He has been giving his own interpretation to various aspects of OROP. Some of these, including the counter by the Services are given in following paras.

7.    Definition of OROP.   According to PCDA, definition of OROP should be drawn from the Finance Minister's budget 2014-15 speech vide which the gap between pre-2006 retirees and post-2006 retirees for all ranks needs to be closed. Here he is quoting the first part of the FMs speech while conveniently ignoring the second part as given in Para 1 above. The Service representatives attending the meetings have pointed this out in the meeting and have also drawn attention to the definition given by the Rajya Sabha Committee on Petitions.

8.      Interpretation of the Term 'Uniform Pension'.  The PCDA has opined that 'Uniform' pension means pension under a uniform pay/pension structure i.e. under the same pay scales with same qualifying service & pension calculation formula. According to him it need not necessarily lead to same pension for all the retirees (past & present) in the same rank and same qualifying service because of the annual increments being given to the serving personnel. The Services have of course countered saying uniform pension means one/same/equal/identical pension.

9.      Length of Service.  The PCDA has further held that the 'length of service' in the OROP definition is to be treated as the number of years of service put in by the pensioner in the rank last held. Alternatively, according to the PCDA, if total qualifying service is to be treated for the purpose of OROP then qualitative aspects relating to length of service in terms of number of years rendered in each rank the service person has served before the retirement in the last rank held, needs to be taken cognizance of. This they concede will be difficult to implement in practice. The counter by the Services is that length of service and qualifying service are synonymous as given in Rule 19 of Pension Regulations 2008 as also in the MoD letter dated 17.01.2013.

10.   Bridging the Gap.    The PCDA has further held that while bridging the gap between the pre-2006 and post-2006 pensioners the benefits of improved service conditions (viz. method of faster promotion applicable to the current personnel) should not be extended to past pensioners. This in fact runs against the concept of automatically passing on future enhancement to past pensioners, which is intrinsic to the definition of OROP. The Services have pointed this out, also underscoring the fact that the benefit of MSP and Grade Pay for calculation of pension has already been extended to past pensioners. The Services have further suggested that there should be a periodic review of OROP say on yearly basis, wherein any anomaly can be addressed.

Conclusion

11.    For reasons best known to them the outgoing government announced OROP too late and could not get it implemented during their tenure. With their term nearing the end, the bureaucratic hierarchy reportedly stopped being responsive to political orders. The dunderheaded obduracy of some financial bureaucrats can delay it for some time but cannot stop OROP. It is reiterated that OROP has come about after a long effort of over three decades. While some delay in its implementation is understandable, any hint of dilution will be resisted and will result in renewal of the struggle by The IESM.