After the One Rank One Pension (OROP) was announced by Defence Minister Manohar Parrikar on the September 5 last, apprehensions were expressed about its affordability by the nation's economy and also on creation of a precedent for other organisations to demand it.
The current pension budget for the Defence pensioners is `54,000 crore. This budget includes payments to 400,000 civilian pensioners who had worked under the Ministry of Defence and served up to the age of 60 years. These civilian pensioners are not part of the OROP. They are 23 per cent of all Defence pensioners and receive 45 per cent of the Defence pensions' budget, i.e. `24,300 crore. The balance 55 per cent worth `30,000 crore is disbursed among 77 per cent military pensioners.
The cost for implementing OROP Scheme has been worked out by the Controller General of Defence Accounts (CGDA) at `8,293.48 crore for all military pensioners including those who took premature retirement. Different estimates, to roll out the OROP, by vested interests are afloat. Also, views are being expressed that the country cannot afford this expenditure in the long run.
According to IMF's latest world economic outlook, India's GDP is poised to rise by 7.5 per cent annually for next five years. It shall get into higher gear thereafter. To study the affordability aspect, we shall presume the GDP rise at 7 per cent per annum. The perceived rise in pension bill needs to be put in the correct perspective. I will take four years (2016-17 to 2019-20) for the Government to fully absorb the financial impact of rolling out OROP plus the cost of annual reviews at 3 per cent. Within and next 6 years (2020-21 to 2025-26), the Government will completely recover from the financial effects of recommendations of 7th CPC plus annual reviews. It will be noticed that despite payouts on account of rollout of the OROP, implementation of the recommendations of 7th CPC and the annual reviews at 3 per cent, the percentage of military pensions still will be negligible by 2025 - 26, clearly indicating that all these will not impinge upon the nation's financial capacity.
Still higher affordability of the economy shall stand out by the fact that it requires three years+ (2026 - 27 to 2029 - 30) to neutralize the financial burden consequent of implementing recommendations of 8th CPC and the annual reviews. With this trend, the nation's economy shall bear the burden of implementing the recommendations of subsequent CPCs in its strides. Thus there will not be a monstrous rise in military pensions that the nation's economy cannot afford.
There are five Central Armed Police Forces (CAPFs) of the Union of India. The purpose of creating was for carrying out internal security duties, to be standby to the State police and State armed constabularies. Their role, training, organization, equipment, capabilities tasking and results can never be akin to armed forces. The Armed Forces are "Stand-alone" caliber and incomparable.
All personnel retire at the matured age of 57 / 60 years as against 85 per cent soldiers who compulsorily retire early by 35 - 37 years of age and only 2 per cent get to serve beyond 54 years of age. CAPFs receive all entitled benefits of service viz, annual increments, promotions, salary enhancements on recommendations of 3 - 4 Central Pay Commissions and perks during service.
OROP is military pension for the military personnel, as the Koshiyari Committee noted " that military and civilian terms and conditions of service are not comparable and 'cannot be equated': military conditions are 'tougher and harsher'; there is greater risk to life and limb, stress and strain, transfers and dislocation, adverse family life, bleak career prospects, 'undefined and unlimited working hours', and the "Armed Forces are also subjected to Court Martial system". And additionally, there are restrictions on their fundamental rights. The real service conditions, job content, job profile and stress levels of military men and their families are unmatchable by CAPFs. Bangladesh border is manned by one of the CAPFs and it is understoodthat around three crore Bangladeshis have crossed over to India. Imagine the results of even 30 Ajmal Kasabs entering through western borders where hundreds continually keep awaiting for an opportunity to cross over and lose their lives in turn! If any civilian wishes to get a feel of military service, he should request for attending a three-day training session of battle inoculation of an armoured regiment or an infantry battalion.
40-45 per cent of ex-servicemen chose to retire early on grounds of supersession or likely supersession for various reasons or unlikelihood of Promotion Board being assembled before the date of superannuation. lucrative commercial re-employment has been stated as the reason for their exclusion. All the military, taking up commercial employment within one year of premature retirement, are required to take permission from their appointing authorities. It will be interesting for the Government to carry out an 'Internal Check' to establish the number of such personnel. It shall result in a miniscule number-probably a fraction of a per cent! Is the punishment to large numbers justified by exclusionIJ It is necessary that the Government gives a rethought on the aspects before issuing any notification for implementing OROP Scheme.
(The writer is a retired Colonel. Email: rameshkhatri@iib.ws)
