Demystifying the OROP riddle: Here's why the govt is dragging its feet

It may seem strange but it is true that all the brouhaha about One Rank One Pension (OROP) did not exist until 1973 when then prime minister Indira Gandhi discontinued the OROP architecture with the publishing of the Third Pay Commission report. The issue has snowballed since then. OROP has been a simmering pot for the last four decades. In hindsight, it could be said that Indira Gandhi is the mother of the OROP controversy, which has dogged subsequent governments over the past 40 years, and has reached a flashpoint under the Narendra Modi government. [caption id=“attachment_2415898” align=“alignleft” width=“380”] Representational image. AFP[/caption] Essentially, OROP is a demand by ex-servicemen for a parity of pension that will do away with the present system, in which a soldier who retires more recently draws a larger pension than one who retired earlier. At the heart of the problem is the fact that even if their ranks and lengths of service happen to be the same, a soldier’s pension is determined by the last salary drawn. The issue has escalated because of the sheer number of ex-servicemen, which is around 2.8 million. And this number has been swelling year after year. Under OROP, ex-servicemen are demanding that no matter when an officer or jawan retires, they should get the same pension. So whether an officer retired in 1973 or 2000, his pension should be the same as the one received by an officer of the same rank who retired in 2010. Currently, officers who have served at least 20 years in the military get 50 percent of their last salary before retirement, as pension. This has accentuated the pension controversy in the case of ex-servicemen because almost 98 percent of India’s soldiers retire before the age of 54 years, and among them 85 percent compulsorily retire between 35 and 37 years of age. The more fortunate ones who retire between the age of 40 and 54 years constitute 12 to 13 percent of soldiers. This is in stark contrast to civilian government employees who retire at the age of 60. Ex-servicemen say that they have no problem with their pension structure if they too were to retire at the age of 60, like their civilian counterparts do. Since this is not the case, they want their pension structure to be rationalised. This also means that while a civilian government servant sees three to four Pay Commissions during his or her service tenure, an armed services employee doesn’t have that luxury and he gets to see one or at the most, two Pay Commissions. The implication is obvious: A civilian, who retires at the age of 60, draws far more pension than his armed services counterpart, who retires much earlier. This is because the pension is calculated on the basis of the last pay drawn. The fact that the group of ex-servicemen is 2.8 million-strong means that this section is a huge vote bank for political parties. But ironically, nothing has been done to assuage their hurt sentiments over the past four decades. The OROP issue became a major controversy in 2008, when the Sixth Pay Commission formally rejected the demand. By the time the 2014 General Elections were held, the OROP issue had become full-blown, and the two major political parties, the Congress and the BJP wooed the electorally significant chunk of ex-servicemen and their families, amounting to ten million voters. The outgoing Congress government had rocked the OROP boat by allocating Rs 500 crore in its interim budget of 2014. The current government has been dragging its feet over the demand as implementing OROP will cost at least an estimated Rs 8,300 crore annually and the figure will inevitably rise year after year. As a result, ex-servicemen are getting increasingly disenchanted with the Modi government and have accused it of “constantly shifting goalposts” and not coming out with any “concrete proposal” to resolve the issue. The veterans have been insisting on pegging the base year at 2013-14 with an implementation date of 1 April, 2014. On 31 August, 2015, Finance Minister Arun Jaitley ruled out annual revisions of pension, and said that annual revisions in pensions do not take place anywhere in the world. But he also said that the government will safeguard interests of soldiers retiring at an early age through higher pensions. In his first full budget in 2014, Jaitley had allotted Rs 1,000 crore for the implementation of OROP — double the amount allotted by the previous UPA government. However, there is a flipside and the government is painfully aware of it. The day the demands of the ex-servicemen are met, the government will inevitably be carpet-bombed by similar demands from others in paramilitary forces. This will obviously open up the proverbial Pandora’s Box.