Talks between the government and ex-servicemen agitating for implementation of the one-rank one-pension scheme are veering towards closure with both sides having worked out a compromise formula on the base year as well as rollout date.
What remains to be sorted out is whether pension hikes are to be effected on a yearly basis as demanded by the veterans or after a gap of five years as suggested by the government.
Official sources said exhaustive negotiations involving senior government officials and military veterans represented by Lt Gen (retd) Balbir Yadav and Maj Gen (Retd) Satbir Singh have led to a narrowing down of differences with the government committed to implement the OROP scheme. The government is keen that ex-servicemen discontinue their hunger strike before the OROP settlement is announced.
According to available figures, the government will have to shell out Rs 8,299 crore annually of which Rs 7,100 crore will go towards implementing the scheme for personnel below officers rank with an expected 23% hike in pensions.
If the scheme is implemented from April 1, 2014 as demanded by veterans, the government will have to shell out Rs 14,500 crore in arrears by the end of this year, making a significant dent in the exchequer.
Authoritative sources indicate that both sides may settle for a compromise base year between 2011 as suggested by the government and 2013-2014 as sought by veterans, with an implementation date negotiated towards third quarter of 2014.
But the sticking point still remains the yearly revision demanded by veterans with the government determined that ex-servicemen show flexibility in this demand. While the veterans point out that yearly hike is given in US and UK military, government officials counter it by saying only cost of living index is adjusted each year in these countries while dearness allowance in India is revised after every six months.
“In UK, the base year for pensions is 1975, 2005 or 2015, while in US the base year is 1980 or 1986,” said a defence analyst.
While the government is rather keen to accede to demands of veterans, they point out that military pensions have been on the up on a periodic basis over the years with then defence minister Pranab Mukherjee looking into the issue in 2006, a committee of secretaries in 2009 and the cabinet secretary committee in 2012 which recommended maximum pay among the three services as a yardstick for pensions.
“The fact is that pensions of civilians have increased only by 2.5 times since the last pay commission in 2006 but a sepoy with 20 years of service who got Rs 2,486 as pension on December 31, 2005 now gets Rs 12,880, a five-fold increase,” said a government official.