One Rank, One Pension: All About

One Rank, One Pension states that every retired soldier of the same rank and who served for the same number of years should get the same pension.

The scheme One Rank, One Pension (OROP) has been highly debated recently. Actually, the scheme was supposed to be implemented since 2011, but the government has been dragging its feet because it would cost too much.

Right now, the way pension works is that when someone retired in 1980, he would get 50% of the salary he drew at the time of his retirement. This pension would then be adjusted by some percent for inflation every year. Now consider someone who retired in 2015 from the same rank and after serving the same number of years as the person from 1980. Their pension would much higher than from 1980 as their monthly salary would be much higher. After all, salaries increase much faster than inflation.

It seems a little unfair that two people who worked for the same number of years and retired from the same position would get two vastly different pensions. So, according to One Rank, One Pension, these two people would get the same pension. Currently the discussion involves the pension of the retired Indian Armed Forces.

Basically, One Rank, One Pension states that every retired soldier of the same rank and who served for the same number of years should get the same pension. This has become a huge deal as ex-servicemen, especially those who retired before 2006 are drawing smaller pensions than their counterparts and even their juniors.

It was recommended that the One Rank, One Pension scheme be implemented immediately by the Koshyari Committee in 2011. However, the Indian government has been dragging its feet as it would be very expensive to implement it across all the retired military officials, especially as the pension must be paid over the life period of the retired officer and over the life period of their spouse. Furthermore, over 85% of the soldiers are compulsorily retired between 35 and 37 years of age. Also, more and more Indians are now living longer due to advancements in medicine. Hence, that is a lot of pension to be paid.

The Supreme Court had ordered the implementation of OROP six years ago in 2009. Congress had tried to implement the scheme in its last Budget in 2014 before the elections, but only allotted a meager Rs. 500 crore budget. It is estimated that implementing the OROP will cost the government at least Rs. 8,300 crore.

OROP became a major political point in the 2014 elections with every political party claiming that they will expedite the implementation of OROP. However, as of August 2015, nothing has been done.

Image Courtesy: indiatvnews.com

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