The government on Saturday said the One Rank One Pension (ORPO) for the ex-servicemen will be implemented with effect from July 1, 2014, which will cost around ₹ 10,000 crore to the exchequer per year. The expenditure on arrears would also be around ₹ 10,000 to 12,000 crore.

Announcing the decision, Defence Minister Manohar Parrikar said though the previous government had said in February 2014 that OROP would be implemented in 2014-15, it did not specify what OROP would be, how it would be implemented or how much it would cost. He added that ₹ 500 crore allocated by the then government was not adequate enough.

The Congress and the veterans, however, have rejected the government’s announcement. The veterans, who are holding protests here, said the government has rejected six of their demands. Former defence minister AK Antony said the Narendra Modi government has diluted the promise of the UPA government and about 46 per cent of the ex servicemen, who took voluntary retirement, will be hit by the decision.

Parrikar said the issue of OROP has been pending for nearly four decades. “It is a matter of deep anguish that the various governments remained ambivalent on the issue of OROP,” he said. “It is pertinent to mention that the then Minister of State for Defence in 2009 had, in reply to a question, informed Parliament that there are administrative, technical and financial difficulties in implementing OROP. It is for these reasons that the present government took some time to fulfil its promise,” he said.

He said the estimated cost to the exchequer to implement OROP would be ₹ 8,000 to ₹ 10,000 crore at present, and will increase further in future. “Despite the huge fiscal burden, given its commitment to the welfare of Ex-Servicemen, the government has taken a decision to implement the OROP,” he added.

The government said it will bridge the gap between the rate of pension of current and past pensioners every 5 years. The veterans were demanding a review in every two years. “The benefit will be given with effect from 1st July, 2014. The present government assumed office on 26th May, 2014 and therefore, it has been decided to make the scheme effective from a date immediately after. Arrears will be paid in four half-yearly instalments. All widows, including war widows, will be paid arrears in one instalment. To begin with, OROP would be fixed on the basis of calendar year 2013,” he said. .

He said personnel who voluntarily retire will not be covered under the OROP scheme and in future, the pension would be re-fixed every 5 years.

The Congress said the announcement was disappointing. “For the first time, the defence minister tried to bring politics in the defence briefing,” Antony said contesting the government’s claim that it was for the first time that the issue was addressed. “In ten years, the UPA increased the pension three times, amounting ₹ 7,000 crore. The announcement of ₹ 500 crore was token. We had constituted a committee to study the nuances,” Antony said and added that ex-servicemen will have to face substantial loses due to the decision. “95 per cent of the defence personnel retire at the age between 35 and 40. Just 1,000 people retire at the age of 60. You should have a different approach towards the Army personnel,” Antony said.

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