The controversy on the govt’s move to clear OROP arrears in four batches
Context- The Supreme Court Monday asked the government to clear One Rank One Pension (OROP) dues of 10-11 lakh pensioners by February end of next year in three equal instalments.
Refusing to take the sealed cover from the defence ministry on the OROP arrears case, the apex court also set deadlines of April 30 for the defence ministry to clear pending arrears to six lakh family pensioners and gallantry award winners and dues to retired servicemen aged 70 and above in one or more instalments by June 30.
(Credits- The Economic Times)
What is OROP?
- The Narendra Modi government implemented the OROP for Armed Forces personnel and family pensioners in 2015. In a letter issued in 2015, it said pensions would be revised with effect from July 01, 2014, and said the pension would be reset every five years.
- In keeping with that, the union cabinet in December last year had approved revision of pension of Armed Forces pensioners and family pensioners under OROP with effect from July 1, 2019.
- This meant that the pension of the past pensioners would be reset based on the average of minimum and maximum pensions of the defence forces retirees of the calendar year 2018 in the same rank with the same length of service.
- All Armed Forces Personnel who retired till June 30, 2019, were to be covered under this revision, which will include more than 25.13 lakh (including over 4.52 lakh new beneficiaries) Armed Forces pensioners/family pensioners. The benefit would also be extended to family pensioners, including war widows and disabled pensioners.
- At that time, the government had said that arrears will be paid in four half-yearly instalments, except for family pensioners — including those in receipt of special/liberalised family pension and Gallantry Award Winners — who will be paid arrears in one instalment.
- The arrears are the amount calculated between July 2019 and December 2022, when the revised OROP was not under implementation but was supposed to be.
- Accordingly, an amount of Rs 28,138 crore was included in the defence pensions budget for 2023-24 to meet this requirement.
Why is there an issue with OROP arrears?
- After the government’s December 2022 decision — further reiterated by a government order issued in January this year — a group of ex-servicemen moved the apex court seeking that the arrears be paid in a single installment instead of four installments.
- The January order stated that the OROP arrears would be paid in four half-yearly installments.
- The ex-servicemen in its plea said the Centre, by issuing this order, subverted the apex court’s March 2022 order, in which it had said that arrears payable to all eligible pensioners of the armed forces shall be computed and paid over accordingly within a period of three months.
- Subsequently, the Supreme Court earlier this month asked the defence ministry to withdraw the order. It had said the communication was “directly contrary” to its verdict of last year that had asked for the clearing of all arrears within three months.
What are the Centre’s issues with clearing OROP arrears in one go?
- As per officials in the government, the cabinet note which was approved by the union cabinet last year had mentioned that instalments be cleared in four instalments, barring exceptions.
- While the government did make an appropriation of 28,138 crores in the budget for 2023-24 for payment of OROP arrears, officials explained this does not mean that this entire budget is available to the government for a lump sum payment.
- They said for every installment paid, the Ministry of Finance will have to balance cash inflows and outflows — in the absence of which the government might need to go for additional borrowings to fill the deficit. Currently, the government is not in favour of such a move.
Way Forward- As per government data, around Rs 57,000 crore has been spent (Rs 7,123 crore per year) in eight years in the implementation of OROP. While the Supreme Court came down heavily on the government for submitting its reply in a sealed cover, it gave the government three separate deadlines for the clearing of dues by February next year.
Source- Indian Express
NEWS- The controversy on the govt’s move to clear OROP arrears in four batches
Syllabus- GS-2; Social Security
