Wednesday, August 03, 2016

Notice From Judicial Committee On OROP

The DESW web-site carries a notice from the Judicial Committee appointed for examining representations on implementation of OROP.

More on this later:

The notification states at para 2, "Taking into account, the various representations that were received in response to the public notice, Department of Ex-Servicemen Welfare, Ministry of Defence referred the following questions to the Commission, through their letter dated 20th July, 2016".

The questions listed at para 2 (i) to (iv) of the notification appear to be only those that have been referred to the One Man Committee by DESW.

This raises some very important issues for serious consideration by all stake holders as follows :
  • When the Government invited representations from affected stake-holders, on anomalies in OROP implementation, vide a notification in April 2016, was it not understood that the representations would be considered by the Judicial Committee and not filtered out by the same department and organizational structure that had probably caused the anomalies in the first place?
  • When a representation is submitted to a Government department, is it not expected that some sort of public record would be maintained in respect of the representation and its disposal status intimated to the individual or association making the representation?
  • Since a Judicial Committee has been appointed, should it not see it fit to obtain access to all representations received and do some screening within its own resources and apply its own judgement on the representations instead of accepting the view of the department responsible for creating the anomalies as to what is an anomaly and what is not?
  • Why can't all anomalies submitted in response to the notification be placed online for access by all stake-holders? Would that not ensure transparency?
  • It is probably a very good thing that the Committee has now decided to meet veterans at various places across the country. But before undertaking the "contact campaign"  what is wrong with a little methodical processing of all representations laboriously compiled and submitted by stake-holders over the months? Do we assume most of those have been given the short shrift by the collating agency and have ended up in some closed folder, or worse, a government issue waste paper basket? The short-list of anomalies in the notification does cause some unease on that account.

Let us not forget, there are some serious unanswered questions and lack of clarity about the manner in which the OROP tables have been compiled. It is now quite important for those affected to seriously revisit issues stressed on in the past.

A copy of the current notification as downloaded from the DESW web-site:

Representations On OROP

The DESW web-site carries a notice from the Judicial Committee appointed for examining representations on implementation of OROP.

More on this later:

Monday, July 04, 2016

Check Points For 7 CPC Pension "Awards" For Armed Forces Veterans

That implementing recommendations of a pay commission has not taken the customary two to three years, is in itself an achievement of sorts and worthy of praise. How far the implementation will go in justifying the lofty principles enunciated in the text of the 7 CPC recommendations remains to be seen.

We are yet to see the shape of tables and manner of calculations that normally translate the intent of the recommendations into actual delivery of the award. The VI CPC imbroglio over "PB III or PB IV for Lt Cols" Or the "Minimum of Pay In Pay Band" controversy are still fresh in our minds.

Much has been made of the fact how the VII CPC matrices will ensure OROP for civilian pensioners as well as for armed forces veterans. There has been some informed analysis on blogs, chat-rolls or group-mails over pension fixations.

To avoid needless speculation in the absence of factual data, the stress should be on what would be a correct and equitable pension fixation for pensioners. This becomes very crucial in the case of time-bound ranks. Some time ago, I had made an attempt to illustrate the issues involved with the very simple example of pensioners who had retired in the ranks of Major and Lt Colonel.

We do not know how such parities can be or will be accomplished. If at all. Several options do exist and these have been discussed in the past, such as :

  • Establishing parities by endorsing applicable pensions in PPOs.
  • Considering anomalies holistically and jettisoning the discrete approach to basic principles that apply to parity of pensions.
  • Appreciating the need to do away with differential treatment for same class of veterans, whether it is related to OROP or 7 CPC. {Edit: And, retrospectively, even in relation to pensions fixed by 6 CPC}

In this context, I've read several opinions as to how the 7 CPC matrix would need to be applied in the case of older pensioners. Perhaps it would need specific elaboration in the implementation orders as to what index and which level in the matrix would apply to older pensioners keeping in view their qualifying service.

As among Officer veterans, the two time bound ranks of Major and Lt Col are most affected by these disparities, in the absence of any concrete figures at present, veterans in this category can only wait and see how close the actual fixation is to the following desirable "check point".

Sunday, April 10, 2016

Another Bonanza For Pre-Mature Retirees

We had barely stopped cheering the relative advantage pre-mature retirees had received on account of OROP fixation (please view the previous blog-post) when along came the great news that the pro-rata reduction had been removed on pensions of those who had retired before 1st Jan 2006.

Till such time MOD and PCDA issue details of the revision, it would be a bit pre-mature to rush to making arrears calculators though some have already started appearing. But, just taking the revised PCDA order on VI CPC pensions, of those who had retired before 1st January 2006, it has been possible to make a first estimate of how their pensions will increase.

It is obvious that since it is pro-rata reduction on pensions that has been removed, those who retired earliest would benefit the most. From the graph prepared on the basis of the table of pensions applicable from 1st January 2006 till 30 June 2014 for, this must be emphasized again, pre 1st January 2006 retirees, it would appear pensions of Lt Col(TS) would receive the biggest boost of about 31.9% at QS of 20 years, followed by pensions of Brigadier retirees at about 28.15% for the same QS of 20 years. Lt Col(Select) and Col/Col(TS) would get nearly identical increases of about 22.21% at the same QS of 20 years. In fact, percentage increase graphs for Lt Col(S) and Col/Col(TS) are nearly merged. The percentage increases reduce as QS increases for all ranks.

But these are percentage increases over the existing pensions calculated in the table after applying pro-rata reduction. Equal percentage increase won't mean the same increase in Rupee terms. The graphs should be just a rough reckoner for PMR retirees and we need to wait for the final word from PCDA. (Viewers may access and use the zoom/pop-out facilitations on the frame below by hovering the cursor over the frame with the mouse)

But there is a buzz, not easy to ignore, that though removal of pro-rata reduction was absolutely justified, the principle of equal remuneration for equal work would appear to indicate the necessity of some sort of pro-rata enhancement of pensions of those pre 1st January 2006 retirees who had served more than the number of years required to get the pension based on minimum of pay of rank in the VI CPC pay-band, and as this pension will now be paid to everyone regardless of their QS.

This needs to be looked at from another angle. Though there is no pro-rata reduction of pensions for those retiring after 1st January 2006, a Lt Col taking PMR at 20 years of service will not get the same pension as one taking PMR at 23 or 24 years. Their pensions will depend on the number of increments they have drawn in their pay-band, the only difference being these pensions will not be subjected to pro-rata reduction.

So, if there is now parity between pre 1st January 2006 and post 1st January 2006 pensioners in the matter of there being no pro-rata reduction, should there not also be parity of manner of fixation of pensions for post and pre pensioners based on their QS or increments drawn?

In fact what 7 CPC has proposed by way of basing pensions on increments earned at time of retirement won't be OROP but the sort of full parity that could now be justifiably asked for in respect of pensions from 01 Jan 2006. As to how 7 CPC recommendations could cater for OROP, please refer my previous posts on that subject. 

Wednesday, March 16, 2016

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

Friday, March 04, 2016

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. 
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 equated to 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.

Friday, February 19, 2016

"Rank Last Held" vis-a-vis "Rank For Pension"

A reading of one of the blog-posts on Maj Navdeep Singh’s blog “Indian Military Services Benefits And Issues” (link at the end of this blog-post) drew attention to a portion of the circular issued for implementing OROP.

Para 11(b) of PCDA circular 555 mentions a distinction between ranks in which ESM retired and ranks to be used for computing pensions.

The context, in which the para has been inserted, remains unclear. At first glance this appears to relate to those specific cases of PPOs in which the two types of ranks have been endorsed for payment of pension to holders of such PPOs.

However, just the knowledge that such a provision can exist helps to indicate a way out for establishing parity of pensions for older and current retirees.

We know that para 11(a) of Circular 555 provides for payment of Lt Col pensions to post 01 Jan 1996 retirees in Maj rank with more than 21 years of service. This would be one example of “Rank For Pension” being different from “Last Rank Held”. As to how OROP can ever be OROP if pre Jan 1996 Maj retirees, with the same service of 21 years, do not get the same pension as post 01 Jan 1996 Maj retirees, is not a matter that should be left for a judicial commission to sort out.

This anomaly does not end with the 21 years matter. The afore-mentioned blog post in Maj Navdeep Singh's blog mentions the fact, and I quote, ”nobody retires in the rank of Major as per the current dispensation, the pension of past retirees was to be based on notional fixation”. All very understandable so far. But the blog-post goes on to suggest, I quote again, “figures in the tables however fall below the notional fixation for the said ranks. An officer of the rank of Major, if taken as not promoted to Lt Col and progressing in his own rank with due increments in his own pay-band…”. Here we get into a zone of imagination that centres on what if the older Maj retiree had continued to draw increments in his own pay-band? I would like to ask here, what is so ”notional” about that?

The older Maj retiree who had put in 20 years, or more, of service would have retired as Lt Col with equal service after 16 Dec 2004. If we have to start imagining things and arrive at “notional” fixations, what is wrong with the “notion” of the older Maj retiree having actually progressed to the pay-band of Lt Col, a notion based on an actual parallel post 16 Dec 2004, rather than imagining non-existent increments in the same rank?

Besides, giving a time bound promotee who retired prior to 16 Dec 2004 less pension, fixed in a lower pay-band, than another time-bound promotee with the same service who retired after 16 Dec 2004, is as clear a case of discrimination as can be thought of. It is all very well to cite fortuitousness as a basis for such differentials. Cut to the basics, it is all a result of capricious whimsy and arbitrariness rather than a ”fortuitous” outcome of some administrative process.

I clearly recall a case being cited when a serving Officer of the armed forces stated that ”it was opined”, a phrase very useful for justifying administrative logic of the reprehensible kind, that there are “bound to be loosers(sic) and gainers” in Govt decisions such as the selection of date of implementation of AV Singh Committee.

The concept advanced by that individual, of the Govt acting as a croupier in a game of chance at a casino, is so unspeakably repugnant that one yearns for a metaphorical blow-torch to enable incineration of such loathsome ideas at the source, taking care, of course, that the brain-cells that produce such logical travesty be only mildly singed in the process, in deference to provisions of human rights, or principles of SPCA if applicable in view of the dubious state of evolution of neurons and synapses that could produce output of that nature.

Therefore, if we are to implement parities as called for in a paradigm changing concept such as OROP, we need to jettison some intellectual baggage that keeps us rooted to ways of old. The distinction provided for in Circular 555 points us in the right direction.

Just imagine, if the administrative machinery could issue the appropriate orders and PPOs could be endorsed as follows:

  • Endorsement In PPOs Of Maj With Service More Than 20 Years And Less Than 26 Years : “Rank Last Held   : Major; Rank For Pension : Lt Col”

  • Endorsement In PPOs Of Maj and Lt Col with Service More Than 26 Years : “Rank Last Held : Major/Lt Col (as applicable); Rank For Pension : Col(TS)”

This would come close to the idea of the previously spoken about variable veteran rank and do away remove a major anomaly arising out of “One Rank” of OROP not being really “one rank”. Let us not forget, yesterday’s Major with 20 years service = Today’s Lt Col with the same service. It is a central concept in the whole gamut of ideas and views on OROP.

As to why the stalwarts keep repeating OROP as implemented being “One Rank Several Pensions” and lose sight of the fact that OROP should also not be “Several Ranks And One Pension” is something that will need to be looked into and put up for consideration at a subsequent date.

Reference : Item (b) of blog post  

Friday, February 12, 2016

OROP Pensions Vis-a-Vis Pensions based On VI CPC Pay Band

It is nobody's case that making a hypothetical calculation based on the VI CPC pay-band, as applicable to a specific rank, would yield the "average of minimum and maximum pensions in calendar year 2013".

Nevertheless, an estimation can be made to the actual process that could have gone in to the making of the OROP tables.

Some interesting, as well as puzzling, observations also arise when the two sets of pensions are viewed graphically.

As an example, the rank of Lt Col can be examined. The graph covers the QS period from 13 years to 30 years, the pay-band being applied at the starting point of 13 years, when an Officer picks up the rank of Lt Col.

The two sets of pensions do show convergence at the starting point of pensionable service, viz. 20 years. The convergence ends after a a QS of about 22 years when the OROP pension stays basically flat and begins to fall well short of the pension calculated on the basis of the VI CPC pay-band.

The gap is noticeably wide at a QS of 26 years onwards at which point, in fact, the pension ought to have parity with the pension of Col(TS). As things stand, the OROP pension remains well below even the pension calculated on basis of the VI CPC pay-band as applicable to the rank of Lt Col.

But, this has to be stated again. OROP pension was supposed to have been based on the minimum and maximum pensions for the same service in Calendar year 2013. Whether or not that was the case is not clear. If OROP pensions are indeed the average, then it is possible in calendar year 2013 Lt Col retirees had not yet reached the increment stages of the VI CPC pay-band for their years of service due to initial VI CPC pay fixation.

Whatever the explanation be, this leads to yet another gap in information on lines of the ones mentioned in the previous blog-post.

{Edit} Another interesting fact emerges. If pensions of Col retirees, based purely on PB-4, are compared with OROP pensions, then unlike in the case of Lt Col pensions, the OROP pensions are mostly higher than PB-4 based calculations. The same riders as above apply, of course: