Saturday, September 05, 2015

The OROP Announcement

With Hon'ble RM repeating most of the press-reports of the last couple of days while announcing the outlines of OROP, the initial reaction of dismay from all affected is understandable.

Some of the online praise being heaped on this "implementation", clearly stemming from political affiliations or ignorance, or a combination of the two, is also understandable but not really germane to the issue.

At first glance, the manner in which OROP is intended to be implemented raises several issues. These can be listed, in my perception, in the following descending order of priority :

Averaging Of Pensions Paid In Base Year

*Which pensions are to be "averaged"?

*Will these be pensions paid throughout the base year? Would the base year be the calendar year 2013 or the financial year 2013_14? {Edit} : Will these be notional pensions based on pay and years of service for each rank?

*Will these also include the bottom of pay-band pensions of pre VI CPC  retirees paid in base year thus bringing OROP pensions much lower than pensions of current pensioners with the same rank and pension service? That is what the statement appears to imply as per highlighted text.

*Which pensions paid data from base year will be used for Major retirees with more than 20 years of service as no such retiree would have retired in base year, all Officers with that length of service having become Lt Cols. Would the OROP pension for such retirees be based only on pensions applicable to those who retired as majors prior to VI CPC?

*Similarly, what would be the pensions paid data for Lt Cols and Maj retirees with more than 26 years of service as no Maj or Lt Col would have  retired with as many years of service in base year or after 01 Jan 2006. Would such officers also be getting their pensions bench-marked to those with equal service who retired prior to 01 Jan 2006, in other words the existing "bottom of pay-band pension" i.e. "no change"?

*Most importantly, how would such averaging bring about OROP? Averaged pensions, mostly applicable to pre 01 Jan 2006 retirees, would be much lower than pensions of current retirees as their own lower non-OROP pensions (bottom of pay band) paid in base year would be used for calculating the average.

Five Yearly Review This had been an important issue between the ESM associations and the Government. There were points of view that perhaps a biennial review, or even a triennial one, could have been used. I am very sure even an annual exercise of reviews is entirely feasible as I have stated in the past few blog-posts. But, now with this averaging bomb-shell, the review takes on another vitally important dimension. ESM associations had expressed the misgiving that with a five year review we would have One Rank Five Pensions. Bad enough though that was, now with this averaging scheme, even with a one year review there would be several pensions for the same rank. There would be the highest pension for a post 2006 retiree and a range of pensions of those retiring after 01 Jan 2006 and then the averaged pension as applicable to pre 2006 retirees which will be the lowest of the lot. The annual review could have bridged the gap somewhat through a process of annual averaging. But with the five yearly review, that option too is gone.

Time Bound Promotions This had been covered in online discussions and apparently catered for in a DGL attributed to thinking within the Services HQs. Today's statement on OROP is totally silent on this very important issue giving rise to apprehensions of further strife and litigation on a matter clearly related to discrimination.

Pre-Mature Retirement On TV, one had to uncomfortably view interviews with spokespersons so clearly trying to fudge issues, trying to mislead by bringing in issues of "boarded out" personnel and then trying to divert attention to those who had not completed pensionable service. How would the matter of OROP relate to those who had not completed pensionable service anyway? The interviewers also did not know how to press the matter by being specific and asking these fidgeting entities as to what was the disposal in respect of the people who had taken pre-mature retirement after completing pensionable service and were currently in receipt of pensions. So, till the official Government letter implementing OROP is issued, this matter will continue to exercise the minds of those affected.

Unless these issues get addressed in subsequent days and weeks, OROP as announced will have failed to come anywhere close to the way it has been defined and accepted.



  1. Arithematic translation without figures ,average of max(nil)and min(nil) rate of pension base year 2013 cost 10k-12k crores of rupees.Jai Hind

    1. Requests for ascertaining actual cost are already in place.