Saturday, 29 August 2015

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

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 29th 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 6th 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


  1. Great post, Sir. But it needs to b splashed in papers, tv, & every citizen of India should know it by heart, then v can at least b sure of some better opinions & maybe even decisions from the Top Trio!!

  2. One of the most non-controversial, easily verifiable manners of annually reviewing the OP in OROP would be to do away with all this misleading, misunderstood and misquoted terminology of 3% and linking to the 30% salary increase over 10 year period etc.

    Let us deal with actual pensions paid out in the month of review viz., July of 2014, and 2015. The authorities responsible (PCDA) should make a table for the highest pension actually paid for each rank corresponding to varying years of service (these would have to start from 20 years and onwards). These tables could be ready by September 2015 (separate tables for both 2014 and 2015).

    Pensions for each rank corresponding to varying years of service could then be fixed based on the corresponding highest pension actually paid in July 2014 for equal years of service for that rank for the periods July 2014 to June 2015.

    The highest pension actually paid in July 2015 would be the basis for fixing pensions of all retirees with the same years of service and that rank for period from July 2015 to June 2016.

    Pensions for Jan 2016 onwards would be regulated by VII CPC but till such time VII CPC recommendations are implemented, pension review on these lines could continue with reviews effective July 2016, 2017, 2018.

    All payments are now computerized and arriving at the highest pension figures in this manner should not be an issue.

    However there is a rider. It is possible that for rank "x" and years of service "n" the figures available for actual pension paid in July 2014 and July 2015 may be less than hypothetical retirees with rank "x" and years of service "n" retiring on 31 June 2014 and 30 June 2015. A retiree with that rank and years of service may not actually have retired in June 2014/June 2015.

    To meet this specific situation, the highest potential pensions based on pensionable salary of a serving person with rank "x" and service "n" years, as on 30 June of 2014 and 30 June 2015, could be calculated for comparing with actual paid pension data for establishing the highest pension to be paid to older retirees. As salaries too are computerized, such "potential pensions" should not be difficult to arrive at.

    1. @ sunlit sir rgds, right and practical way of orop fixation manner as narrated by you.

      As rightly explained by blog moderator that ". It is understood that the tables were prepared by Air Force Pay Commission Cell based on a 5 year data of retirees (NCOs, SNCO, Warrant Ranks and Officers) obtained from AFCAO. It is understood that the Defence Minister has approved the validation of the tables and DGL prepared and the consequent amount of Rs 8300 croe (approx) as arrears for FY 2014-15 and a similar but lower amount as arrears for 2015-16 till June 2015.

      Sir with reference to your theory and above clarification on modalities by respectable blog moderator now nothing is left for approval as far as orop is concerned. bcz base year 2014 is accepted by govt and service dgl figures is also accepted by govt and 3% demand can be do away with so left out is approval and implementation until and unless the so called esteemed head of the ESM representative have different ideas......

    2. May be if you have done some calculations based on what you say, please pass it on to UFESM to further their negotiations.

    3. Dear Sunlit,
      Well explained! Thanks.
      But you said,
      “To meet this specific situation, the highest potential pensions based on pensionable salary of a serving person with rank "x" and service "n" years, as on 30 June of 2014 and 30 June 2015, could be calculated for comparing with actual paid pension data for establishing the highest pension to…………………………………………..”
      Why complicate what is simple.OROP is not a computed figure but is a statistical figure arrived at by considering the pensions awarded in the period under consideration. ‘Max factor’ figure in the data collected, the Service HQs said, in the run-up to the ‘DGL’ in May, 2014.
      The ‘potential pensioner’ in your alternative method,
      1.Might not retire that year
      2. He might get promoted and take his pay to the next rank
      thus making his potential pension irrelevant in the statistical process for determining OROP.
      Why not just keep it simple, as you explained, to the ‘max factor’ figure?

    4. @Abe Calculations and figures can be utterly misleading and inappropriate in the absence of a complete understanding of underlying issues. Please consider following the link in my comment dated 30 Aug on this very blog post for a fuller picture of what I was trying to say.

      @penmil : Again, my request would be to follow the link in my comment dated 30 Aug. The potential max pension would serve as a reliable indicator that current fixation was in order as based on actual highest pension paid in July of a year. My suggestion, if you follow the link, is for those potential retirees due to retire by June next year but at time of review have the same service as those being bench marked. It would be a reassurance that no great anomalies exist in the benchmarking being done at time of a July review. The potential pension figure may not actually be used for benchmarking.

      As for "complications", this would be validated data from computer databases. It is easily do-able. The great workforce at the disposal of PCDA can deliver, though they might haggle a bit on "overtime".

  3. The news received on 29/08/2015 from JM is "A retired army havildar who was on a relay hunger strike as part of agitation by veterans for early implementation of 'One Rank One Pension' was today rushed to the Army hospital after his health deteriorated."

    Considering the welfare and health of defense veteran participating in RHS and FUD the speculated 3% annual review of defense pension formula is misleading so the spokes person/media adviser is requested to convey the feelings of stake holders to the so called esteemed head of the ESM representative and agree to the offered orop basics pensions figures if otherwise acceptable.

  4. I have embedded a review format to try and highlight what, at first glance, appears to be involved in a system of review for OROP.

  5. Thank you Col for explaining to logger heads the facts.

    Why these Bureaucrats do not apply their mind and brain when it comes to soldiers pensions DRDO and other civilians dominated organizations to be taken out from Defence paying head. They should have DCivilian head.


    1. @Thomas Manimala : " not apply their mind and brain.."

      But they do! They do!
      And devious minds those are, too.
      That is why we end up with our status diluted over the years, because we don't use ours, whatever little minds we do have.

  6. No rebuttal can be more powerful than clear data. A trend and amount of increase in monthly outgo, on account of annual OROP reviews, can be immediately established, if need be through the RTI route.

  7. Fine! Good points in these ideas.Now the issue is holding up ,delayed for years despite all
    available data , well defined terms and then some person says I have new definition and new principles.
    These are dirty tricks and we are occupied and bogged down in explaining solutions to poped up non existant problem.
    The people involved have adequate intelligence and intellect .They are fooling around. These issues should have been resolved much earlier.- solvable in few hours if there is will and earnestness.
    What is this bargaining ??? ,after delaying for 17 mts and quoting estimates for two yrs ,against annual estimate of 8300 crores.