It is contended that the implementation of One-Rank-One-Pension (OROP) for the armed forces would create a severe strain on government finances. Explain the principles underlying the OROP and arguments that have been cited in its support as well as opposition.
OROP means that every soldier who retires in the same rank gets the same pension, irrespective of his date of retirement. As of now, soldiers who retired more recently receive more pension than those who did earlier because pensions are dependent on the last salary drawn — and successive pay commissions have hiked salaries.
- As per government estimates, additional Rs. 8,400 Crore will be required to implement OROP which will certainly put severe strain on government finances.
- Further, it is bound to increase every year and with every successive pay commission – a constant escalation of the implicit pension debt on the government.
- Moreover, as military personnel retire at a younger age compared to their civilian counterparts, defence pensions are paid for a much longer period.
- Definition of OROP: There are too many definitions of OROP, the government need to come up with formula which is acceptable for all.
- Lack of records: the Defence Ministry told the Koshiyari Committee that records going back further than 25 years were no longer available
- Service Duration: people who retire in the same rank often earn different pensions because they may have served for longer periods in that rank. Equating their pensions will unlikely to withstand a legal challenge.
- Civilian Pensioners: The government also seems worried that OROP could lead to a similar demand from civilian pensioners. They could demand for reverting to the old fixed pension regime from present contributory pension system.
In spite of these arguments which are holding government back in its implementation, the OROP is a demand supported by all political parties.
The arguments in favour of OROP are:
- Compensation for early retirement: Since soldiers retires early, they are denied the opportunity to earn more increments and promotions, as well as the benefits offered by more recent pay commissions, which significantly affects their pensions. OROP can address all of this.
- National Obligation: Defence forces personnel give up their best years to the service of the nation and society, suffering hardships of military life — and, at the end of their service, face limited opportunities for re-employment
- Share in GDP: Though the amount of defence pension has risen in recent years, their share in GDP has declined considerably.
Thus, it is not mere a financial matter but also an emotional matter for veterans and soldiers. A nation cannot allow its soldiers to feel that it does not care for them. OROP is essentially an obligation of the Indian nation towards its soldiers.