Coming To Grips With OROP Data

Now that the anxiety ridden issue of grant of OROP to past pre-mature retirees seems well out of the way and credit of  the first installment of OROP arrears, to pensioners' accounts, is in progress, there is a need to take a step back and try to make a sense out of the manner in which OROP pensions have been fixed.

One may need to go back to the graphs and charts of one or two of my previous posts (links at the end of this blog-post). But to simplify the matter for a clearer understanding of, if nothing else, the need to understand, we can consider the effect of OROP on just two ranks of pre 01 Jan 2006 retirees, Lt Col and Col. Both select and time-scale ranks can be considered. (The zoom and pop-out facilitations on the embedded graph could be used if required)

We see from the above graphs, based on data taken from circulars 500 and 555, that there is a steady decrease in the percentage enhancement due to OROP with an increase in qualifying service.

That should provide some reassurance to those veterans who had taken pre-mature retirement before 01 Jan 2006. They get more of a percentage pension boost due to OROP than those who super-annuated after serving for  longer periods.

At the same time, it could be a source of puzzlement to pre 01 Jan 2006 veterans who did not take pre-mature retirement. Ought they not to have received as much of a percentage increase on account of OROP, if not more, than those who opted for pre-mature retirement? A question could arise if the declining trend in percentage pension increase is almost tantamount to imposition of a penalty on veterans for not having taken pre-mature retirement!

It is possible, of course, that pensions of post 01 Jan 2006 pre-mature retirees not being subjected to proportionate reduction of pensions, unlike pensions of their pre Jan 2006 predecessors, the Calendar year pensions in 2013 were, as a result, considerably higher than those of pre Jan 2006 retirees in the same rank and with the same service. This could explain the greater percentage increase of OROP pensions of pre 01 Jan 2006 retirees at a QS of just 20 years.

In some cases, it is not just the percentage, the actual quantum of OROP arrears is higher for retirees who took PMR at a service of 22 to 23 years as compared to retirees in the same rank with a QS of 28 or 29 years.This is easily discernible from the following graph that shows actual amounts and not just percentage increase of OROP pensions plotted against qualifying service (The zoom and pop-out facilitations on the embedded graph could be used if required):

But charts and tables can't tell the whole story. As has been mentioned elsewhere, where did OROP figures for Maj retirees at a service of 20 years come from? Or for a Lt Col with service more than 26 years? Did anyone in those ranks actually retire with service of 20 years and 26 years, respectively, in 2013? If not, what was the basis of fixing OROP pensions for Maj retirees with service more than 20 years and Lt Col retirees with service more than 26 years? Is it possible the graphs are skewed because of faulty logic having been applied in fixing OROP pensions based on some flawed extrapolations?

If sense is to be made of the slippery slope the above graphs appear to depict, perhaps obtaining actual data and methodology that formed the basis of OROP fixation, on the lines suggested previously, could be seriously considered.

Previous blog posts on the matter  can be accessed through this link. 

Rectifying OROP Anomalies

It is extremely heartening for beleaguered sub-sections of veterans to have their cases taken-up and represented by eminent personages.

In the context of OROP, the following tweet from Hon'ble Member of Parliament, Shri Rajeev Chandrasekhar, comes as a breath of fresh air amid all the slogan-shouting, stonewalling and obfuscations that have begun to cloud discourse on the subject. 

More #OROP anomalies highlighted to @manoharparrikar. Read my representationhttps://t.co/po63eUHQSH

— Rajeev Chandrasekhar (@rajeev_mp) March 2, 2016

It is clear the representation, in section A of annexure to the letter, points to the manner in which the definition of OROP has been amended in successive Government communications.

Section B of the annexure on "Anomalies Effecting Particular Ranks" mentions in the opening para  the need for a re-look at pensions of Hon Naib Subedar, Major and Lt Col.

At item (b), a mention is made of differential treatment to Major retirees with 21 years of service depending on whether they retired prior or subsequent to 01 Jan 96.

In all the three pages of annexure to the letter, as was originally available against link in the tweet, the reference to pension of Lt Col, as mentioned at the beginning of the annexure, was not elaborated upon. One can only presume it was a reference to the 26 years anomaly.

The anomaly in connection with Maj retirees with 21 years service, glaring though it is, is not the complete picture.

I have tried to underline the principle of parity of pensions (link provided at the end of the blog-post) underlying the concept of OROP. Time and again, it has been mentioned that when a current retiree super-annuates, with the same years of service as a previous retiree but in a higher rank currently given on time-bound basis, the older retiree needs pension parity on basis of pension of the current retiree in the higher time-bound rank.

No Major retires with 20 years of service anymore. The older retiree can't have his OROP pension fixed on some far from transparent, rule-of-thumb calculations based on hypothetical, imaginary or "notional" increments in the pay-band applicable to Major.

An officer who retired as Major with 20 years of service in 1974 can't have his pension based on some "notional" or "imaginary" increment in the pay-band applicable to Major in the year 2013. The only logical, equitable and fair way of ensuring pension parity would be to see in which time-bound rank an officer with the same type of commission would have actually, under normal circumstances, retired in calendar year 2013*, also with 20 years of service. In this case the corresponding current rank would be Lt Col.

• Therefore, it is not just the 21 years pension parity that is an issue under OROP. Any veteran who retired in the rank of Major, with a service of 20 years to 25 years, needs to get a pension equivalent to the average** of actual max and min pensions of Lt Col retirees with equal service in calendar year 2013*.

• The same principle applies in the case of older Major, Lt Col(TS) and Lt Col retirees (those who'd held permanent commissions) who retired prior to 16 Dec 2004 with a service of 26 years or more. They need to have their pensions fixed in the pension table equal to the average** pensions of Col(TS) retirees of calendar year 2013* with equal service.

To any reasonable mind it might appear these principles of parity need to apply not just to OROP pensions but to all past fixations of pensions as well, the last one being pensions fixed with effect from 01 Jan 2006 by VI CPC. In the context of OROP, there is even less justification for discrimination between older and current retirees.

Past references to "parity based" issues, can be accessed by clicking this link.

*Note: "calendar year 2013" is used in this blog post in relation to where things currently stand in OROP implementation. The subject matter would apply equally if the reference year was changed to financial year 2013-14.

**Note: The term "average" in "average pensions" is used in the blog-post in context of the implementation letter actually issued and does not detract from the argument that it should be the maximum pension actually paid to a retiree with equal service.