Rebuttal by Media Adviser UFESM to Times of India

Rebuttal by Media Adviser, UFESM to Times of India and Times Now 

Courtesy: - Cdr Ravindra Waman Pathak I.N. (Retd)      

Member Governing Body and Pension Cell

Indian Ex Servicemen Movement

1 Surashri,1146 Lakaki Road
Shivajinagar Pune 411016
raviwarsha@gmail.com
9822329340 

To: "nalinnikki@gmail.com"

Cc: "rajatpandit@gmail.com"

 kaulvrcanil@gmail.com

Dear Nalin,

I am sending this Rebuttal from the nearest computer available at my brother in law's place at Noida.

Apropos Times of India “Times view” published in your edition of 29^th August. 

As media adviser of UFESM, I wish to rebut your views and put the record straight of what is the essence of OROP and not as postulated by you. In this connection your attention is invited to the one point of contention between the government and ESM organisations. This relates to a wrongly quoted and much misunderstood terminology of a 3% increase in pension for all pensioners year on year in perpetuity. 

In essence, it is not a 3% increase but is a periodic review of pension to bring them at par with past pensioners. This has been narrowed down to the figure of 3% keeping in view the 30% increase in salaries of serving government servants between two pay commissions. When related to pensions it is reduced to 1.5% being 50% of any pay slab. This is further amplified that such an increase would be applicable to a pensioner till he/she reaches the top scale of their authorized pension. There after it ceases to be granted till such time as a new pay commission kicks in and salaries are increased. 

The current out flow of OROP due to the inordinate delay in its implementation over the last 9 years has resulted in an increase of estimated cost of approximately 6000 crores leading to a figure of 8,293 crores as a “onetime payment.” There after as worked out by the three service pay cells independently followed by a review and checking by CGDA and finally the MoD. The figure of out flow in the following year would be .85% of the defence pension budget and subsequently reducing @. .62, .32, .21 and 0. Therefore by the 6^th year there would be no review required. Mathematically calculated the highest pro-rata percentage amounts to approximately Rs.1635 crores and reducing and therefore quite a low figure to what is being mentioned in the range of 20,000 crores by un informed or deliberately obfuscating individuals who do not have the best interest of the armed forces in their mind.

Another figure being bandied around is the defence pension bill of Rs. 54,500 crores. Unknown to most including servicemen and veterans, who should be made aware, Rs 32,000 crores out of this services 4 lakh defence civilians. The balance Rs 22,000 crores is all that is available for 26 lakh ESM and 6 lakh widows. To add insult to injury most of the defence civilians are in receipt of Non-Functional Financial Upgradation (NFU), essentially meaning that they have availed OROP since 2006. Incidentally for the uninitiated the out flow of NFU in the past 8 years is whopping Rs 17,000 crores for a motley crowd of at best 20,000 personnel. 

We on our part have clearly spelt out the entire basis of our calculations but it seems that other than MoD, the finance ministry and the PMO do not seem to be able to bring out in the public domain any contentious issues that need to be ironed out. It is our perception that whatever is being done in the current scenario by various stake holders in the MoF & PMO is with a view to embarrass the Prime Minister, by not allowing him to honour his commitments made on board the INS Vikramaditya and re-confirmed in the sacred battle fields of Siachen. For us soldiers honouring a commitment irrespective of the costs involved financial or otherwise is much more important than the financial benefits of OROP.

 Mr. Prime Minister, would you like to take a call?

 

Col Anil Kaul, VrC (retd)

Media advisor

UFESM

The Red Herring of 3% annual increment in Pension - Update

It is reliably learnt that a certain meeting taken by the Defence Minister where representatives of Service HQ as well as members of the governing/executive committee of ESM organisations were present, the following was made clear and obvious and approved by the Defence Minister: -

1.  There isn’t an annual increment of pension because increment is for every additional year of service rendered to the Nation either as Services personnel or as civilian Govt employee.

Elucidation A: - Increments are paid for every subsequent year in service i.e pay of a serving personnel A with 25 years service will be 3% lesser than the pay of a serving personnel B with 26 years of service.

Elucidation B: - Pension is paid on the basis of the last pay drawn for the number of years of service rendered. In the above example, A will get a pension for 25 years of service and B will get a pension for 26 years of service. An increment will mean that A will get the pension of B, who has rendered 26 years of service and pension of B will have to be incremented and become pension for 27 years of service.  

[Please see tables below]

The Origin of the 3% (Annual) Increment demand in Pensions

2.            However from a summary of the minutes of the first meeting (of the Joint Working Group on OROP) it is well worth noting that it appears that the seeds of the mischief of an increment were sown in the incorrect recording of minutes of this meeting compiled by O/o CGDA in the following manner: -

2.1.   At Para 4 (c) of the minutes, O/o CGDA recorded the minutes as follows: -

As future enhancements have to be automatically passed on to the pensioners, Services proposal for incremental increase in pension on 1^st July every year shall be considered.

2.2.  The mischief was corrected by Rear Admiral P Joshi, Chairman PARC & Naval Pay Commission Cell when he deleted the above and inserted and initialled in the margin in his own handwriting before he signed the minutes of the JWG: -

As future enhancements have to be automatically passed on to the pensioners, Service proposal for annual revision of OROP tables should be considered.   

Therefore, there is no basis as reported in the media for projecting a 3% increment attributed to leader(s) of a particular ESM organisation.

3.      There would, however, be an annual review in OROP tables. This is to remove one or more of the following anomalies: -

3.1. If C retires in a certain rank with 20 years service on 30 June of that year will draw less than D who retires with 20 years of service on 31^st July of the same year because D gets the benefit of 3% increment on 1^st July.

3.2.   Bunching effect of 4 years in 4^th CPC, 3 years in 5^th CPC and 2 years in 6^th CPC

3.3.   Implementation of AVSC Phase I w.e.f 16^th December 2004. It has resulted in officers being promoted to say Select rank of Lt Col in the 18^th year but those after 16^th December 2004 being promoted in the 14^th year.

 4.      Perusal of the modified/enhanced parity tables [Circulars 500 and 501 on PCDA (P) website] indicate a pension of Rs 7065 for a Sepoy in the 20 to 27 years service bracket and increased to Rs 7175 if the Sepoy served 27.5 years or more. Similar cap will occur for all personnel within a time frame of 5 years. Therefore, alarm bells rung by vitiated persons are based on lack of information or mala-fide misunderstanding of the issue of OROP

5.      It has been calculated and revalidated with data that for the period of 5 years the financial effect is estimated to be 0.85% or Rs 185 crore.

6.       The first annual review was scheduled to take place on 1st Jul 2015 if OROP was implemented in Apr 2015 and the next annual review was to take place on 1^st January 2016, when the recommendations of the 7^th CPC kick in. Thereafter all annual reviews would be effective from 1^st January of that year.

7.      It is understood that the 7^th CPC is very clear about the differences between Civilian pension and Military pension. Due to the Civilian Govt employees serving till the age of 60 years, 7^th CPC has termed civilian pensions as mature pension. Because Services personnel retire at younger ages, Military pension has been termed “aborted” pension, deserving a different method of being dealt with by 7^th CPC.  

8.       It is also understood that the ESM present at the meeting (Lt Gen Balbir Singh, Maj Gen Satbir Singh, Brig Katara, Gp Capt Gandhi etc) had vouched for the DGL prepared for OROP by Services HQ and their arguments in favour of matters cited in above paragraphs.

 9. To clear the mis-statement of a very senior Lt Gen that there are two increments in the 6^th CPC, I reproduce gist of the Govt Resolution 1/I/S/2008 which approved the recommendations of the 6^th CPC with certain modifications: -

9.1. Para 1, Note 1: The edge presently accorded to Indian Administrative Service and Indian Foreign Service at three grades STS, JAG and SG will continue in the form of two additional increments @ 3% each which will be adjusted in the pay band (emphasis supplied). 

Interpretation: The 3% increments are for IAS & Indian Foreign Service for the 3 grades and it will be absorbed in the Pay Bands of the 6^th CPC. There isn’t anything for Armed Forces like the Lt Gen (retd) believes.

9.2. Annex I (VII) – Annual increment states 3% across the board except for high performers who will get 4% increments in certain grades.

9.3. SAI (and SNI/SAFI) No. 1 and 2/S/2008 also do not (Repeat) do not contain any mention of two increments of 3%.

 10.          Therefore, the 3% annual increase quoted is nothing but a red herring. Is that why we have ESM on fast unto death believing that 3% increment has to be part of OROP?  

 Now some data

11.  Up to the rank of Major (and equivalents) who are in service will have lower pay in Apr 2014 than say Apr 2007 effect of AVSC which was effective from 16 Dec 2004 .

12. Similarly, in higher ranks there is no guarantee that a Col with 28 years service in Apr 2014 will draw a lower pay and pension than a Col in the 28^th year completed in Apr 2015 or Apr 2016, simply due to the fact of higher fixation to 2014 retiree in January 2006. In fact most cells in the DGL tables (re-produced below) will not change every year.  

Major/Lt Cdr/Sqn Ldr

 In service in Apr 2007

Year	QS	Pay in Pay Band	GP	MSP	Increment in Jul	Total 3+4+5	Pension	Pension in 17 Jan 13 letter
1	2	3	4	5	-	6	7	8
01 Jan 06	7	23810	6600	6000	920	36410	18205
01 Jan 07	8	24730			940	37330	18665
01 Jan 08	9	25670			970	38270	19135
01 Jan 09	10	26640			1000	39240	19620	9930
01 Jan 10	11	27640			1030	40240	20120	10482
01 Jan 11	12	28670			1060	41270	20635	11034
01 Jan 12	13	29370			1090	42330	21165	11585
01 Jan 13	14	30820			1130	43420	21710	12317
01 Jan 14	15	31950			1160	44550	22275	12689
01 Jan 15	16	33110			1200	45710	22855	13240

In service Apr 2014

Year	QS	Pay in Pay Band	GP	MSP	Increment in Jul	Total 3+4+5	Pension	Pension in 17 Jan 13 letter
1	2	3	4	5	-	6	7	8
01 Jan 06	7	21630	6600	6000	850	34230	17115
01 Jan 07	8	22480			880	35080	17540
01 Jan 08	9	23360			900	35960	17980
01 Jan 09	10	24260			930	36860	18430	9930
01 Jan 10	11	25190			960	37790	18895	10482
01 Jan 11	12	26150			990	38750	19375	11034
01 Jan 12	13	27140			1020	39740	19870	11585
01 Jan 13	14	28160			1050	40760	20380	12317
01 Jan 14	15	29210			1080	41810	20905	12689
01 Jan 15	16	30290			1110	42890	21445	13240

Lt Col/Cdr/Wg Cdr

Year	QS	Pay in Pay Band	GP	MSP	Increment in Jul	Total 3+4+5	Pension	Pension in 17 Jan 13 letter
1	2	3	4	5	-	6	7	8
01 Jan 09	14	37400	8000	6000	1370	51400	25700	16716
01 Jan 10	15	38770			1410	52770	26385	17510
01 Jan 11	16	40180			1450	54180	27090	18306
01 Jan 12	17	41630			1490	55630	27815	19102
01 Jan 13	18	43120			1540	57120	28560	19898
01 Jan 14	19	44660			1580	58660	29330	20894
01 Jan 15	20	46240			1630	60240	30120	21490
01 Jan 16	21	47870			1680	61870	30395	22286
01 Jan 17	22	49550			1730	63550	31775	23082
01 Jan 18	23	51280			1780	65280	32640	23878
Year	QS	Pay in Pay Band	GP	MSP	Increment in Jul	Total 3+4+5	Pension	Pension in 17 Jan 13 letter
1	2	3	4	6	-	6	7	8
01 Jan 11	14	37400	8000	6000	1370	51400	25700	16716
01 Jan 12	15	38770			1410	52770	26385	17510
01 Jan 13	16	40180			1450	54180	27090	18306
01 Jan 14	17	41630			1490	55630	27815	19102
01 Jan 15	18	43120			1540	57120	28560	19898
01 Jan 16	19	44660			1580	58660	29330	20894
01 Jan 17	20	46240			1630	60240	30120	21490
01 Jan 18	21	47870			1680	61870	30395	22286
01 Jan 19	22	49550			1730	63550	31775	23082
01 Jan 20	23	51280			1780	65280	32640	23878

Colonel/Captain/Group Captain

Year	QS	Pay in Pay Band	GP	MSP	Increment in Jul	Total 3+4+5	Pension	Pension in 17 Jan 13 letter
1	2	3	4	5	-	6	7	8
01 Jan 09	18	43120	8700	6000	1560	57820	28910	21057
01 Jan 10	19	44680			1610	59380	29690	21900
01 Jan 11	20	46290			1650	60990	30495	22742
01 Jan 12	21	47940			1700	62640	31320	23584
01 Jan 13	22	49640			1750	64340	32170	24426
01 Jan 14	23	51390			1810	66090	33045	25269
01 Jan 15	24	53200			1860	67900	33950	26111
01 Jan 16	25	55060			1920	69760	34880	26953
01 Jan 17	26	56980			1970	71680	35840	27795
01 Jan 18	27	58950			2030	73650	36825	27795

Year	QS	Pay in Pay Band	GP	MSP	Increment in Jul	Total 3+4+5	Pension	Pension in 17 Jan 13 letter
1	2	3	4	5	-	6	7	8
01 Jan 11	18	43120	8700	6000	1560	57820	28910	21057
01 Jan 12	19	44680			1610	59380	29690	21900
01 Jan 13	20	46290			1650	60990	30495	22742
01 Jan 14	21	47940			1700	62640	31320	23584
01 Jan 15	22	49640			1750	64340	32170	24426
01 Jan 16	23	51390			1810	66090	33045	25269
01 Jan 17	24	53200			1860	67900	33950	26111
01 Jan 18	25	55060			1920	69760	34880	26953
01 Jan 19	26	56980			1970	71680	35840	27795
01 Jan 20	27	58950			2030	73650	36825	27795

 13. Conclusion: The above tables clearly show that in steady state, pension will not be revised every year. 

Majors/Lt Colonels/Colonels promoted earlier will draw the same pay and pension as the one promoted after him.

 Once pension is reset on 1.4.2014 thereafter no change will take place except on the implementation of the recommendations of the 7^th CPC.     

 For ORs and JCOs (retd) readers – tables are being prepared and will be posted ASAP. Please understand that there are factors such as Group X, Y and the erstwhile Z as well as maximum benefit etc and many JCOs having reached the top of the table on 17 Jan 2013.

14.      I hope this clears the air and reduces the fog of mistrust and, consequent but inadvertent misinformation & misunderstanding of the red herring of 3% (annual) increment in pensions.