OROP | Supreme Court order helps hit the pause button on a thorny issue

The Indian Army

The Supreme Court ruling on the controversial One Rank, One Pension (OROP) issue on March 16 can hardly be considered the last word on a debate which has consumed so much of heart and mind space in India’s military over the years.

The demand for OROP has been one of independent India’s biggest challenges, and many of today's serving military personnel — all second and third generation soldiers — are deeply-distressed by its non-implementation, despite the lip service of successive governments. The court was deliberating on the challenge by an association of retired defence personnel that there was ‘constitutional infirmity’ in the way the government had announced OROP to ex-service personnel in November 2015. The apex court dismissed the plea.

OROP seeks to ensure that all armed forces personnel who retire at an identical rank after serving for the same number of years get equal pension benefits, regardless of the date when they step down from service. Current rules stipulate that those who retired before 2006 are paid a lower pension than their counterparts who retired afterwards.

This apparent paradox has a lot to do with the different career progression trajectories of the rank and file of the armed forces, with those in lower ranks usually retiring early. Since pensions are calculated on the last pay cheque they receive in service, these retirees have to forgo the potential benefits from subsequent pay commissions.

Curiously, such disparities in service conditions were more or less addressed by the first two pay commissions. But in 1974, the third pay commission brought about major changes in the service and separation conditions for all armed forces personnel.

The changes put early retirees at a distinct disadvantage as compared to their counterparts of the same rank who retired later, never mind if both may have had the same rank. The government of the time, it turns out, had sold these tweaks to an unsuspecting military with the promise of OROP in return for cutting their pensions.

At the same time, pensions for civilians were inexplicably increased in what — in hindsight — gave Indian bureaucracy more elbow room to ‘dictate’ terms to the armed forces. No wonder many serving military personnel and veterans today condemn that historical wrong, and often consider the bureaucracy as the biggest hurdle in the way of OROP.

Seen against this, it is no surprise that OROP remained a will-o-the-wisp for the military for nearly five decades — till the current government accepted it in principle in 2014. The broad contours of the proposed OROP implementation were spelt out the next year by reckoning pension parity of past pensioners with the pension of those retiring subsequently from the same rank and with the same length of service.

It was decided to hold the review every five years with the first OROP calculation carried out with effect from July 2014. However, the next tranche, which was to be calculated in July 2019, was deferred due to some technical hitches.

In its March 16 judgment, the court directed that this pending re-fixation exercise of OROP should be carried out from July 1, 2019, and that the arrears be paid to the pensioners in three months’ time. The court also upheld OROP’s current five-year periodic review, dismissing the petitioner’s plea for an automatic revision every year.

All that said, it would be naïve to believe the court order brings closure to the whole debate. On the contrary, what it does is to hit the pause button on a thorny issue which may never really be resolved — at least not any time soon, given the complexities involved. These include accounting and questions of pay parity with the paramilitary forces and various central government services.

The wide chasm that exists in civilian-military relations has a lot to do with the fact that cadre of the All India Services get promoted regardless of merit and performance. Senior Indian Administrative Services officers who draw ‘apex scale’ salaries are rightly criticised for having tinkered with the system through the Sixth Pay Commission to automatically become eligible for OROP.

This was apparently done so that their own pensions are enhanced every time a new pay commission revises the pay scales! In sharp contrast, defence service officers seldom make it to the ‘apex scale’ and, therefore, have to be satisfied with the token hikes in their pension.

Of the many concerns surrounding the OROP debate, one of the most important relates to its impact on India’s defence budget. Pay and pensions take up a lion’s share of the budget. For example, more than 30 percent of the 2020-21 budget was gobbled up by pension entitlements — a growth rate which may become unsustainable for the government in the near future. So policymakers should perhaps have a relook at OROP, and work out a more acceptable and pragmatic alternative.

In its current avatar, OROP hardly addresses human resource challenges before the armed forces — be it the shortage of officers or the ongoing military modernisation effort. So it is time New Delhi looked beyond merely augmenting pensions of ex-servicemen, and try to utilise the immense discipline, experience, and skills of these veterans for national development.