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  1. Editorial: So what will OROP cost?

Editorial: So what will OROP cost?

FM must tell the nation of its financial implications

By: | Published: September 2, 2015 12:51 AM
OROP

Today, the cost of OROP is estimated – not by the government – at Rs 8,000-12,000 crore, but how much will this rise to in a decade based on the normal hike in salaries given by the Pay Commission each decade? (In pic: Ex-servicemen undergo medical check-up as they continue their hunger strike protesting the non-implementation of ‘One Rank One Pension’ (OROP), in New Delhi.)

Given its financial implications, it is not surprising Finance Minister Arun Jaitley has categorically ruled out annual reviews of pension as demanded by the veterans as part of their One-Rank-One-Pension (OROP) agitation, saying such frequent reviews do not happen like this anywhere in the world. Indeed, this is something the prime minister failed to do when, on Independence Day, he once again reiterated that the government accepted OROP in principle.

The problem, however, is that with everyone in awe of veterans and their sacrifices, neither the finance minister nor the prime minister sound too convincing – indeed, with each passing day, as more veterans on hunger strike are hospitalized and as more top-ranking officers join their ranks, the government appears to be looking more mean-minded and guilty of not honouring its promise. In order to change the narrative, the government needs to change tack, and quickly. If an annual review is not acceptable – and Jaitley has raised the issue of other groups like the CRPF and the BSF also wanting similar reviews – the question is whether a review every 3 years or every 5 years is acceptable, or will it too be ruinous? After all, if the striking veterans agree to a 5-year review, and they well might, the government will have no option but to accept it now.

This is where, as FE has been arguing, the government needs to come out with its own estimates of what it is that the veterans’ demand will cost the country – and within this, there have to be details of what an annual pension review will cost and how this will change if the review is done every 3 years and every 5 years. Today, the cost of OROP is estimated – not by the government – at Rs 8,000-12,000 crore, but how much will this rise to in a decade based on the normal hike in salaries given by the Pay Commission each decade? If, on the other hand, the review is one each year, how much does the burden escalate by? It is only when this exercise is done that people can make a proper call on whether the veterans’ demand is justified or whether it is too expensive. Given a choice, everyone would like an annual review of their pension, just as those living off interest income after retirement would like fixed deposit rates to be benchmarked to the genuine cost of living – in reality, with interest rates on fixed deposits generally lower than CPI inflation, most people are getting less money each year on their savings; in contrast, with all government pensions indexed to inflation, this problem is taken care of even in the absence of OROP. Renuka Sane and Ajay Shah have done a theoretical exercise on how any pension rises with different assumptions – the cost of a one-rupee-per-day annuity for a 60-year old would rise by 35% if a 4% annual inflation is taken into account, and by 94% if an 8% salary hike – this is what would happen if OROP was to become a reality – is assumed. Do the same exercise if pensions have to be paid from the age of 35 – most veterans retire at this age – and the cost rises by 374%. These are frightening numbers, and imply a big choice the country will have to make since spending more on OROP has to be paid for by spending less somewhere else. This is what Jaitley and Modi need to make clear.

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  1. Major
    Sep 2, 2015 at 4:21 am
    These veterans whose velour brought glory to the nation in '65 and subsequent wars are on a stir at Jantar Mantar. The nation is gloating over the '65 war victory in a month long g "Golden Jubilee" celebrations. The very heroes are fighting yet another battle after 50 years of that battle not with stan, but with the politicians and bureaucrats of India. This celebration is like a happy marriage event without the bride and the groom. What a government of paradox we are having. Recently read in a TOI blog that the stani soldiers on the border had unfurled a banner on their bunker saying “Jo ham se takraega, Jantar Mantar pe dande khaega” (Whoever clashes with us will get beaten up at Jantar Mantar). Is it digestible to the Indian public who are mute to such indignities, leave alone the insensitive government of Mr Modi? Mr Jaitley portra the veterans as a greedy lot for asking a rolling pension which is inbuilt in the accepted definition just to mislead the public in their opinion reacting with sympathy. Earlier BJP government under Vajpayee failed us and now the same party under Modo too is inclined to disown his promise to the veterans made not once but many times. The Supreme Court too is mute inspire of the lapse on the part of the government in implementation of OROP. Now it is for the people of Bihar to get us this dignified pension, let us see if they can transform the DNA of these untrustworthy politicians.
    Reply
    1. R
      Rando
      Sep 5, 2015 at 11:45 pm
      Taxpayers will have to pay for this, that is all the ried employees. We have to be careful otherwise we will end up like greece
      Reply
      1. K
        Krishna
        Sep 2, 2015 at 9:39 am
        The Tax payer of this nation has a right to know what is the total cost incurred Pension payout now (approx. 54,000 crores) OROP will add (approx. 10,000 crores) Revenue loss to the nation due tax free goods n cars purchased by them through defense canteens which by the way even a short service officer who has worked 5 yes gets for life (approx. 35,000 crores) Free world cl medical benefits given to them and family for life costs the nation (approx. 25,000 crores) Access to very highly subsidized posh clubs n movie halls to them and families for life which do not pay service tax Vat Etc. (approx. 25,000 crores) Tax free travel by train n Air for life (loss Rs. ? ) It will not be fair to several other noble professions if they are also not given the same. Like Government doctors who work long hours for fixed ry unlike private who charge astronomical sums each time they see you or the police who also work very long hours stand at the polluted signal so that we can be safe.
        Reply
        1. K
          Krishna
          Sep 2, 2015 at 9:45 am
          The Tax payer of this nation has a right to know what is the total cost incurred Pension payout now (approx. 54,000 crores) OROP will add (approx. 10,000 crores) Revenue loss to the nation due tax free goods n cars purchased by them through defense canteens which by the way even a short service officer who has worked 5 yes gets for life (approx. 35,000 crores) Free world cl medical benefits given to them and family for life costs the nation (approx. 25,000 crores) Access to very highly subsidized posh clubs n movie halls to them and families for life which do not pay service tax Vat Etc. (approx. 25,000 crores) Tax free travel by train n Air for life (loss Rs. ? ) It will not be fair to several other noble professions if they are also not given the same. Like Government doctors who work long hours for fixed ry unlike private who charge astronomical sums each time they see you or the police who also work very long hours stand at the polluted signal so that we can be safe.
          Reply
          1. H
            Hurt Indian
            Sep 2, 2015 at 2:53 pm
            Really shameful in the way paid troll of AJ and BJP is calling veterans greedy. This Krishna has no idea of defence forces. Just an armchair critic.Shame
            Reply
            1. W
              Wadhwa
              Sep 1, 2015 at 8:45 pm
              FM is unable to work out 'the Arithmetical Translation' of the OROP. We feel he should need to work on his arithmetic and translation , he will get the solution. The intent is more important than lame excuses for not honouring promises.
              Reply
              1. Anjan Barua
                Sep 2, 2015 at 2:56 am
                Policies seem to be dictated by an over riding clamour for success at the hustings. This cannot go on. A country cannot run on porism and appeat .
                Reply
                1. D
                  Dr GS
                  Sep 1, 2015 at 9:19 pm
                  Govt.has got guilty conscience esp Mr Jaitley
                  Reply
                  1. D
                    Dr GS
                    Sep 1, 2015 at 9:17 pm
                    Since the govt. is hiding more and revealing less, your suggestion is not likely to find favour and FM will not accept what is being suggested in this article.
                    Reply
                    1. K
                      K Ganesh
                      Sep 2, 2015 at 12:23 pm
                      Greedy vetrans. It should be only for jawans as Officers retire late and are nicely rehabilitated. Officers are the golf playing single malt sipping parasitic lot who have now become greedy after enjoying a life of freebies. we can use this 10000 crore for development instead like building infrastructure. If these officers have even an iota of patriotism left in then they would not be blackmailing the government. I would use this money for giving boost to primary education/health etc
                      Reply
                      1. K
                        K Ganesh
                        Sep 2, 2015 at 12:27 pm
                        The lofty sermonizing on honesty, integrity , love for jawaans, patriotism we hear daily from OROP canving Generals leaves a cloying 'sweet bitterness' taste akin to that of an over sweetened tea, especially when we r reminded of the golf carts worth crores purchased in the name of vehicles for disabled jawaans and track recce vehs. And we all know the organized pilferage of kerosine , FOL, rations n CSD items. The way they abuse others seem comical given their own integrated honesty. Of course there might be some different ' definition ' of honesty when it comes to our 'Holy cow'.
                        Reply
                        1. K
                          krishna
                          Sep 2, 2015 at 1:04 pm
                          A true exercise has to be carried keeping in focus how lower ranks are benefited with respect to the officer cadre. Discrimination is at its peak; editor should talk to personal below officer ranks (real soldiers) and can have the stock of real situation. The pay and promotions are hammered for the benefits of officers. Jawans must be made to speak the reality. Please study 3CPC, 4CPC 5CPC and have a comparison study with 6CPC.
                          Reply
                          1. madhusudhan haravu
                            Sep 4, 2015 at 11:22 am
                            Agree.
                            Reply
                            1. M
                              Manto
                              Sep 2, 2015 at 4:26 pm
                              Stop inhuman medieval orderlies system. Stop subsidized alcohol and CSD
                              Reply
                              1. P
                                pkpk
                                Sep 5, 2015 at 2:48 am
                                Gen Satbir is 88 years old and he never aspired for any political office. Defaming him is defaming entire veteran community. Babus run this govt and AJ is head Babu. These folks have unleashed on veterans protesting peacefully and fasting at JM with such abuses as greedy, in-disciplined and irrational. 28 million veterans are mostly (95%) from rural India, where they are major opinion makers, so with family members, relatives and fellow villagers, that comes to about 56 crores. Govt going ahead unilaterally on OROP will anger this 58 crore rural potion. There is no need for Gen Satbir Singh and party to publicize this injustice to veterans, everybody watches TV in India and they know all. Just wait for 2019? For mere 33 crore extra annually on OROP , such a great electoral risk? 8300 crore rupees annually on OROP is nothing. 30% increase every 10 years on OROP is again nothing. It is the babus who have planted stories. India afforded OROP pre 1973 when we were poor, India is going to grow 8% for next 30 years and ours is going to be the fastest growing economy. Another thing when babus granted themselves OROP, none of you commented that India will be bankrupted. Babus have virtually forced public debate on veterans OROP, where as they got OROP quietly. Last attempt by babus to divide veterans planted stories that veteran leaders (generals and lt generals) have accepted govt proposal for review after 5 years. Who are these generals and lt generals? Generals and lt generals are already granted OROP with babus in apex scale? Why would they not want review after 2 years for veterans now that RSS has given danda to powers to be and Modi is free to ignore FM advise? FM is still the media minister and his cronies will fight their battle with military till the govt memo is issued on OROP. Babus know that so far nobody (I SAY NOBODY) dared to challenge AJ? They never figured that RSS will come into the picture. Why not, RSS has to fight one of the toughest battle in 2019? Not AJ, because his RS seat is safe and black coat in the cupboard. Last thing they should do is to cast aspersion on a very senior and respected veteran leader Gen Satbir Singh? Mr Modi, it is your call now and your moment in history.
                                Reply
                                1. P
                                  pkpk
                                  Sep 2, 2015 at 8:44 pm
                                  Good Krishna, let jawans and officers fight? Where is the need for war with stan when we can have war within and at lower cost, which will help AJ as being housewife? What a shame AJ you have allowed situation to come to such proportions!
                                  Reply
                                  1. P
                                    pkpk
                                    Sep 1, 2015 at 8:44 pm
                                    You loser Sunil Jain, despite your vicious anti veteran campaign through this newspaper, OROP will happen. Modi will make it happen. My only aim in life now is to bring your true face to service and veteran community, how you used a media outlet to defame the veteran community and viciously campaigned to deny veterans OROP, promised by the PM and approved by the parliamentary committee and the supreme court. India's military history will judge you for what you've done to veterans.
                                    Reply
                                    1. P
                                      pkpk
                                      Sep 2, 2015 at 8:44 pm
                                      You loser Sunil Jain, despite your vicious anti veteran campaign through this newspaper, OROP will happen. Modi will make it happen. My only aim in life now is to bring your true face to service and veteran community, how you used a media outlet to defame the veteran community and viciously campaigned to deny veterans OROP, promised by the PM and approved by the parliamentary committee and the supreme court. India's military history will judge you for what you've done to veterans.
                                      Reply
                                      1. P
                                        pkpk
                                        Sep 2, 2015 at 8:44 pm
                                        You loser Sunil Jain, despite your vicious anti veteran campaign through this newspaper, OROP will happen. Modi will make it happen. My only aim in life now is to bring your true face to service and veteran community, how you used a media outlet to defame the veteran community and viciously campaigned to deny veterans OROP, promised by the PM and approved by the parliamentary committee and the supreme court. India's military history will judge you for what you've done to veterans.
                                        Reply
                                        1. P
                                          pkpk
                                          Sep 2, 2015 at 8:44 pm
                                          You loser Sunil Jain, despite your vicious anti veteran campaign through this newspaper, OROP will happen. Modi will make it happen. My only aim in life now is to bring your true face to service and veteran community, how you used a media outlet to defame the veteran community and viciously campaigned to deny veterans OROP, promised by the PM and approved by the parliamentary committee and the supreme court. India's military history will judge you for what you've done to veterans.
                                          Reply
                                          1. P
                                            pkpk
                                            Sep 2, 2015 at 8:45 pm
                                            You loser Sunil Jain, despite your vicious anti veteran campaign through this newspaper, OROP will happen. Modi will make it happen. My only aim in life now is to bring your true face to service and veteran community, how you used a media outlet to defame the veteran community and viciously campaigned to deny veterans OROP, promised by the PM and approved by the parliamentary committee and the supreme court. India's military history will judge you for what you've done to veterans.
                                            Reply
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