One Rank One Pension (OROP)

• 04 Dec 2024

For Prelims:  One Rank One Pension (OROP) scheme,  Supreme Court  

For Mains:  Key Features of OROP, Challenges and Implications of OROP 

Source: TH 

Why in News?

Recently, the Prime Minister commemorated the implementation of the One Rank One Pension (OROP) scheme. The scheme was officially implemented on 7th November 2015, with benefits effective from 1st July 2014. 

• OROP aims to provide uniform pension benefits to armed forces personnel based on their rank and length of service, reaffirming the government's commitment to veterans and their families. 

What is OROP? 

• Background: 
  • The K.P. Singh Dev Committee (1984) recommended addressing 'One Rank One Pension', based on the established pension principles for Supreme Court and High Court judges. 
  • The 4^th Central Pay Commission found equalizing pensions challenging, requiring major administrative efforts without ensuring consistent benefits for all pensioners. 
  • The 5^th Central Pay Commission opposed 'One Rank One Pension', arguing that additional benefits shouldn't extend to pensioners due to changes in job roles and qualifications. 
  • The Cabinet Secretary Committee (2009) rejected 'One Rank One Pension', but suggested measures to reduce the pension disparity between retirees. 
  • The Rajya Sabha Petition Committee recommended the implementation of 'One Rank One Pension' for all Defence Forces personnel. 
• Definition: OROP ensures that all armed forces personnel retiring at the same rank receive the same pension, regardless of their retirement date. Eg, a General who retired in the year 1980 will be receiving the same pension as a General who retired in the year 2015. 
  • OROP addresses long-standing demands from veterans for equitable pension distribution, recognising their sacrifices and service to the nation. 
• Key Features of OROP: 
  • Pensions are determined by rank and length of service, ensuring fairness among retirees, while also protecting those already receiving above-average amounts. 
  • Pension Revision: The pension will be re-fixed every five years to account for changes in salaries and pensions of serving personnel. The first revision took place on 1st July 2019. 
  • Financial Implications: The estimated cost for implementing OROP revisions is approximately Rs 8,450 crore annually. 
  • Beneficiaries: Over 25.13 lakh armed forces pensioners and their families will benefit from this scheme. 
    • Includes provisions for family pensioners, war widows, and disabled pensioners. 
    • Uttar Pradesh and Punjab have the highest number of OROP beneficiaries. 
• Supreme Court Ruling on OROP: 
  • The Supreme Court in Indian Ex-Servicemen Movement v Union of India Case, affirmed the constitutional validity of the OROP scheme, determining that different pensions for personnel of the same rank based on their retirement dates are not arbitrary. 
    • It emphasized that differences in pensions arise from various factors such as Modified Assured Career Progression (MACP) and base salary calculations. 

What are the Socio-Economic Implications of OROP? 

• Welfare Enhancement: OROP significantly improves the financial security of veterans and their families, contributing to their overall well-being. 
• Economic Impact: Increased pensions can lead to higher disposable income for veterans, stimulating local economies through increased spending. 
• Social Recognition: Implementing OROP serves as a public acknowledgment of the sacrifices made by armed forces personnel, fostering a sense of pride and respect within society. 
• Uniform Pension: Ensures equal pensions for personnel retiring in the same rank with the same length of service, irrespective of retirement date. 
  • Pension is re-fixed every five years to keep up with current standards. 

What are the Issues in Implementation of the OROP Scheme? 

• High Cost: Implementation cost is significantly higher than initially estimated, impacting the exchequer. 
  • Example: Initially estimated at Rs. 500 crore, the actual cost is between Rs. 8000-10000 crore. 
• Administrative Challenges: Difficulties in retrieving and verifying past records for eligible personnel. 
  • Example: Challenges in accessing historical service records to provide accurate benefits. 
• Complex Implementation: Administrative, financial, and legal complications in executing the scheme effectively. 
  • Example: Legal and logistical issues in ensuring seamless delivery of pension benefits to all eligible individuals. 

Drishti Mains Question: 

Assess the One Rank One Pension scheme's impact on the welfare of India's armed forces personnel.

UPSC Civil Services Examination, Previous Year Question (PYQ):

Prelims 

Q. As per the NSSO 70th Round “Situation Assessment Survey of Agricultural Households”, consider the following statements: (2018)

1. Rajasthan has the highest percentage share of agricultural households among its rural households. 
2. Out of the total agricultural households in the country, a little over 60 percent belong to OBCs. 
3. In Kerala, a little over 60 percent of agricultural households reported to have received maximum income from sources other than agricultural activities. 

Which of the statements given above is/are correct?  

(a) 2 and 3 only 

(b) 2 only 

(c) 1 and 3 only 

(d) 1, 2 and 3 

Ans: c 

Q. In a given year in India, official poverty lines are higher in some States than in others because (2019)

(a) poverty rates vary from State to State 

(b) price levels vary from State to State 

(c) Gross State Product varies from State to State 

(d) quality of public distribution varies from State to State

Ans: (b)