One Rank, One pension(OROP)

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23-Dec-2022: Union Cabinet approves revision of pension of Armed Forces Pensioners/family pensioners under One Rank One Pension w.e.f. July 01, 2019

The Union Cabinet, headed by Prime Minister Shri Narendra Modi, has approved revision of pension of Armed Forces Pensioners/family pensioners under One Rank One Pension (OROP) w.e.f. July 01, 2019. Pension of the past pensioners would be re-fixed on the basis of average of minimum and maximum pension of Defence Forces retirees of calendar year 2018 in the same rank with the same length of service.

Beneficiaries:

The Armed Forces Personnel retired up to June 30, 2019{excluding pre-mature (PMR) retired w.e.f. July 01, 2014} will be covered under this revision. More than 25.13 lakh (including over 4.52 lakh new beneficiaries) Armed Forces Pensioners/family pensioners will be benefitted. Pension for those drawing above the average shall be protected. The benefit would also be extended to family pensioners, including war widows and disabled pensioners.

Arrears will be paid in four half-yearly instalments. However, all the family pensioners, including those in receipt of Special/Liberalised Family Pension and Gallantry Award Winners, shall be paid arrears in one instalment.

Expenditure:

The estimated annual expenditure for the implementation of the revision has been calculated as approx. Rs 8,450 crore @31% Dearness Relief (DR). Arrears w.e.f. July 01, 2019 to December 31, 2021 have been calculated as over Rs 19,316 crore based on DR @ 17% for the period from July 01, 2019 to June 30, 2021 and @31% for the period from July 01, 2021 to December 31, 2021. Arrears w.e.f. July 01, 2019 to June 30, 2022 have been calculated as approx. Rs 23,638 crore as per the applicable dearness relief. This expenditure is over and above the ongoing expenditure on account of OROP.

Background

The Government took a historic decision to implement OROP for the Defence Forces Personnel/family pensioners and issued policy letter on November 07, 2015 for revision of pension w.e.f. July 01, 2014. In the said policy letter, it was mentioned that in future, the pension would be re-fixed every 5 years. Approx. Rs 57,000 crore has been spent @Rs 7,123 crore per year in eight years in the implementation of OROP.

7-Feb-2022: Benefits of One Rank One Pension Scheme

The Government took a historic decision of implementing One Rank One Pension (OROP) for Defence Forces Personnel with effect from 01.07.2014. In this regard, Government issued orders on 07.11.2015 and detailed guidelines along with rates of pension were issued on 03.02.2016 for implementation of OROP. OROP implies that uniform pension be paid to Defence Forces Personnel retiring in the same rank with the same length of service, regardless of their date of retirement, which implies bridging the gap between the rates of pension of current and past pensioners at periodic intervals. Salient features of the OROP are as follows:

  1. Pension of the past pensioners would be re-fixed on the basis of pension of retirees of calendar year 2013 and the benefit will be effective from 01.07.2014.
  2. Pension will be re-fixed for all pensioners on the basis of the average of minimum and maximum pension of personnel retired in 2013 in the same rank and with the same length of service.
  3. Pension for those drawing above the average shall be protected.
  4. Arrears will be paid in four equal half yearly installments.  However, all the family pensioners including those in receipt of Special/Liberalized family pension and Gallantry award winners shall be paid arrears in one installment.
  5. In future, the pension would be re-fixed every 5 years.
  6. Personnel who opt to get discharged henceforth on their own request under Rule 13(3)I(i)(b), 13(3)II(i)(b), 13(3)III(iv) or Rule 16B of the Army Rule 1954 or equivalent Navy or Air Force Rules will not be entitled to the benefits of OROP.  It will be effective prospectively.

In the financial year 2016-17 budget allotment of Rs 12,456 crore was made for OROP payments. No separate allotments have been made in other years. A total of Rs 10,795.40 crore have been disbursed as arrears for implementation of OROP to Defence Forces Pensioners/ Family Pensioners.  However, OROP is not paid as a separate element.  It is integrated part of pension.  As such amount of additional expenditure incurred is not available.

6-Nov-2020: Five years of historic decision to implement OROP

Government of India took the historic decision to implement One Rank One Pension, OROP by issuing an order on 7.11.2015, benefit effective from 01.07.2014, despite huge financial burden demonstrating its commitment to the welfare of ex-servicemen. Armed Forces Personnel retired upto 30.06.2014 were covered under this Order.  Keeping in view the magnitude and complexity of Defence pension, extensive consultations were held with experts and ex-Servicemen before issue of Government order on implementation of OROP.

Ex-Servicemen had been agitating for implementation of OROP nearly for the 45 years, but the same was not implemented before 2015.

OROP implies that uniform pension be paid to the Armed Forces Personnel retiring in the same rank with the same length of service regardless of their date of retirement.  Thus, OROP implies bridging the gap between the rate of pension of current and past retirees at periodic intervals.

A sum of Rs. 10795.4 crore has been disbursed to 20,60,220 Defence Forces Pensioners/Family Pensioners as arrears on account of implementation of OROP.  The yearly recurring expenditure on account of OROP is about Rs.7123.38 crores and for about six years starting from 01.07.2014, the total recurring expenditure worked out to approximately Rs. 42740.28 crore.

OROP beneficiaries also got the benefit of fixation of pension under 7th CPC while calculating the pension by multiplication factor of 2.57.