ONE RANK, ONE PENSION

ONE RANK, ONE PENSION

ARMY VETERANS V/S THE GOVERNMENT
PRATYAKSH AGARWAL 2013A2PS671P

ABSTRACT
The One Rank, One Pension scheme has been a long-standing issue of
more than 2 million ex-servicemen of India. The scheme seeks to
provide a uniform pension to the retired defence personnel on the
same rank and same length of service, irrespective of their date of
retirement. There have been varied arguments for and against the
implementation of the OROP scheme. This report aims to discuss
these issues from the perspectives of the retired army personnel as
well as that of the government.

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Table of Contents
INTRODUCTION ABOUT OROP...........................................3
BACKGROUND WHY THE CONFLICT?.................................4
ARMYS PERSPECTIVE: ARGUMENTS FOR OROP...................6
GOVERNMENTS PERSPECTIVE: ARGUMENTS AGAINST OROP 7
MODI GOVERNMENT OROP SCHEME: 7th NOVEMBER 2015.....8
UNRESOLVED ISSUE: POINTS OF CONFLICT..........................9
CONFLICT ANALYSIS.........................................................10
CONCLUSION: POSSIBLE SOLUTIONS TO THE CONFLICT......11
REFERENCES...................................................................12

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INTRODUCTION ABOUT 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," and that it also 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".

This was the basis for deciding for the pensions of the retired army men till it was
terminated by the Indian National Congress way back in 1973 in the 3 rd Central
Pay Commission. This decision gained high criticism and since then, it has been a
matter of a strong controversy till now. Presently, in the Indian Army, the officers
who have completed at-least 20 years of service are eligible for seeking pensions,
which is 50% of their last salary drawn.
OROP is a complex issue in itself. It has been one of the chief manifesto points of
various political parties from years, yet it has not found its path towards its proper
implementation. The government as well as the retired defence personnel have
their own points of arguments about OROP.
On 7th November 2015, the Modi Government finally implemented the OROP
scheme by issuing a notification. But, this in itself has created a yet another point
of conflict between the army veterans and the government. The demands put by
the veterans have not been fulfilled to their satisfaction and the issue still remains
an unresolved conflict.
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BACKGROUND WHY THE CONFLICT?

The OROP scheme was terminated by the Indian Ministry of Defence (MoD) in
1973, through an ex-parte decision during the tenure of Indian National Congress
led by Indira Gandhi. Also, in 2008, the United Progressive Alliance led by Dr.
Manmohan Singh, disregarded OROP for armed forces and granted OROP to
present as well as the future civil servants, at the apex pay grade i.e. the highest
pay grade. It also granted the Non-functional financial upgradation (NFU) to the
bureaucrats and created many new posts at the apex pay grade scale, so as to
make all the civilians eligible for apex OROP pension. This highly infuriated the
veterans and the agitation has been on the rise since then.
In order to control the unease in the armed forces, a ten member all party
parliamentary committee, known as the Koshiyari Committee was set up in 201011 to probe into the issue. The committee submitting its report in December 2011
unanimously found merit in the OROP scheme and strongly recommended the
Government to implement it. Despite this, the OROP scheme remained
unimplemented till November 2015.
From the historical perspective, the armed forces have faced several denials by
successive governments and bureaucracy in independent India. They are
discussed as follows:

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1. Post independence, new pay scales were introduced for both the military
and civil services. The pre independent civil officers were allowed to retain
their old, higher pay scales, whereas, their army counterparts received
salaries in accordance to the new (reduced) pay scale. There was almost a
reduction of 30% in their salaries.
2. Till the 3rd Central Pay Commission (CPC), as pension, the armed officers and
civil bureaucrats received 70% and 30% respectively of the last salary
drawn. But, by the implication of 3rd CPC, their pensions were made equal,
i.e. 50% of their last salary drawn. There was a reduction from 70% to 50%
for the army officials. They lost out 20% of their meagre pension, which was
in contrast to the civilians who enjoyed a gain of 20% in pension.
3. 4th CPC granted an additional allowance to the army men called rank pay
in addition to their salary. But because of faux paus of the accountant,
there was a deduction of the rank pay from the basic pay, posing a loss to
the army officials. After litigation, the matter was judged in favor of army in
2012.
4. In the 6th CPC, it implied that pension must be fixed at 50% of the minimum
of the rank in the pay band. This led to same pensions to all the 4 ranks in
the army (Pay band-4) i.e. Lt. Colonel, Colonel, Brigadier and Major General,
irrespective of their ranks and the length of service, This remains to fixed till
now.
5. Allowance of Non-functional upgrade (NFU) in 6th CPC to bureaucrats,
inexplicably excluding armed forces, implies that a bureaucrat under certain
terms and conditions can draw salary of a higher pay scale than that of his
rank resulting in higher pension.
6. Disabled civil officials are allowed to continue with their service till their
retirement. On the contrary, a disabled military personnel, where the
chances for medical injuries are much more higher, are denied disability
pension.

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The Supreme Court had ordered the implementation of OROP six years ago in
2009, and in February this year, reminded the government that it is yet to do so.
In 1983, the Supreme Court said, "Pension is not a bounty nor a matter of grace
depending upon the sweet will of the employer."

ARMYS PERSPECTIVE: ARGUMENTS FOR OROP

1. The army men retire at an early age between 30-35 years as the army
require young and fresh legs, whereas, the civil counterparts continue till 60
years. Thus, their salaries are vey less because of the loss of opportunities
to earn promotions and increments, resulting in lower pensions.
2. Defense personnel receive pension according to pay scale prevalent during
their time of retirement. It is not adjusted according to the subsequent pay
commissions leading to huge disparities in pensions among personnel
retiring in varied periods of time.
3. The juniors retiring in the current period receive almost double pension as
compared their seniors who retired previously for the same length of
service.
4. After retirement in the early age of 35, the career of army personnel end, as
they are no longer absorbed in the workforce of the country. Thus, OROP is a
compensation for their early retirement.
5. It is a moral obligation of the government to respect the retired army
veterans and make them feel dignified. OROP addresses all these issues.

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6. High inflation in the recent years and vulnerability in the old age
necessitates higher pension to live a dignified life after a dignified service
period.

GOVERNMENTS PERSPECTIVE: ARGUMENTS AGAINST

OROP
1. The implementation of OROP for the army personnel could lead to similar
demands from various other departments such as paramilitary forces, local
police etc.
2. OROP will be very costly for the government and would put a huge burden.
This is not a one time cost which is to be paid. According to the government,
8000-10000 crore is the amount that is needed for pensions plus the
arrears sums up to about 12000 crore.
3. The government fears that huge amount such as 22000 crore may also
lead to unsustainable pension bills
4. Legally, the official who retired 30-40 years back cannot be granted the
same pension as that of a current retiree. Also, according to OROP, an army
official retiring from the post of Colonel who served for 5 years for the post
will receive the same pension as that of an official retiring from the same
post but served only for 2 years. This itself is a big legal challenge in itself.
5. On the administrative grounds, there are lack of old written records and it is
very cumbersome to reconcile older cases due to lack of resources.
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MODI GOVERNMENT OROP SCHEME: 7th NOVEMBER

2015
The current ruling NDA government finally implemented its own version of OROP
on 7th Nov 15. The salient features of the scheme are as follows:
1. To begin with, pension of the past pensioners would be re-fixed on the basis
of pension of retirees of calendar year 2013 and the benefit will be effective
with effect from 1.7.2014.
2. Pension will be re-fixed for all pensioners on the basis of the average of
minimum and maximum pension of personnel retiring in 2013 in the same
rank and with the same length of service.
3. Pension for those drawing above the average shall be protected.
4. Arrears will be paid in four equal half yearly installments. However, all the
family pensioners, including those in receipt of Special/Liberalized family
pensioners, and Gallantry award winners shall be paid arrears in one
installment.
5. In future, the pension would be re-fixed every 5 years.
6. Personnel opting for Premature Retirement (PMR) will not be entitled to the
benefits of OROP.
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7. The Govt. has decided to appoint a Judicial Committee to look into

anomalies, if any, arising out of implementation of OROP. The Judicial
Committee will submit its report in six months.

UNRESOLVED ISSUE: POINTS OF CONFLICT

The ex-servicemen fighting for OROP have rejected the governments notification
and ratcheted up their protests by returning their medals. Some ex-servicemen
even tried to set fire to their medals, but were prevented from doing so by their
colleagues. There are various points of disagreement between the government
and ex-servicemen. They are listed as follows:
1. Equalisation of pension every year, i.e. the ex-servicemen want the revision
of pension every year instead of five years as proposed by the government.
2. Fixation of pension of old retirees to maximum of the current retiree,
whereas, the government has fixed it to the average of the minimum and
maximum of the current retiree.
3. Exclusion of army men seeking premature retirement (PMR) because in the
Indian army, almost 70% are premature retirees.
4. Set up of one judge judicial commission which will submit its report in six
months must be replaced by a five member judicial commission comprising

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of three army veterans, one government representative and one nominated

member which would submit the report in a month.
5. The base year for calculating the pensions should be 2013-14, i.e. from 1
April 2014 and not 2014-15, i.e. 1 July 2014.
6. Arrears would be paid in half-yearly installments; however, all widows would
be paid in one installment.

CONFLICT ANALYSIS

CONFLICT: Implementation of OROP

STAKEHOLDERS: Army veterans and the government
NEGOTIATIONS:
1. Koshyari Committee 2011
2. Modi Government 2014-15; The PMO is represented by

Nripendra Misra,

principal secretary and the veterans delegation is led by Major General (retd)
Satbir Singh.
MEDIATION: Chief of the Army Staff General Dalbir Singh has been the mediator
through out the meetings with the PMO.
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CLOSURE OF CONFLICT: The OROP scheme has been implemented, but still the
veterans are not fully satisfied stating the fact that only one out of six demands
have been fulfilled. Few have agreed to the terms of the OROP, but majority are
still agitated.

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CONCLUSION: POSSIBLE SOLUTIONS TO THE CONFLICT

After considering the OROP from various perspectives, as a conclusion, OROP
must have had been implemented, which has been done. The army veterans are
discontented with the proposals of the OROP, but they must also agree to the fact
that its practically impossible to fulfill all their demands because of the financial,
legal (constitutional), and administrative constraints of the government. However,
there may be a possibility of a few solutions to the disagreements, wherein both
the parties can reach a common consensus. According to me, to resolve this
conflict, both the stakeholders will have to bend down on various points. In the
end, I would like to propose some suggestions that may help in this conflict
resolution.
1. Increase of income tax or additional surcharge may help in financing OROP,
thus lowering the financial burden on the government.
2. There can be a provision of employment of the ex-servicemen in
government jobs so that there may be decrease in the huge pension
amounts.
3. The revision of pensions of civil bureaucrats can also be a way out. Lowering
their pensions by some amount can also help in financing the government
for OROP.

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REFERENCES
1. http://www.firstpost.com/india/govt-implements-orop-veterans-welcome-movecall-off-hunger-strike-but-will-agitate-for-five-rejected-demands-2422476.html
2. http://indiatoday.intoday.in/story/army-veterans-and-pmo-on-the-verge-of-abreakthrough-to-seal-orop-deal/1/461265.html
3. http://www.thehindu.com/opinion/editorial/take-charge-oforop/article7880801.ece
4. http://www.firstpost.com/india/army-veterans-vs-modi-govt-all-you-need-toknow-about-one-rank-one-pension-scheme-2269032.html
5. http://indianexpress.com/article/india/orop-will-apply-to-armed-forcespersonnel-who-retired-prematurely-modi/
6. http://www.niticentral.com/2015/06/14/one-rank-one-pay-orop-perspectivefrom-our-veterans-317866.html
7. http://www.dnaindia.com/analysis/standpoint-why-the-one-rank-one-pension-isnot-a-good-idea-2121032

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