SC seeks Centre’s stand on ‘One Rank, One Pension’, asks if it went back to automatic enhancement

One Rank and One Pension, OROP, Supreme Court of India, Defence Minister,  Additional Solicitor Gene
Image Source : PTI

Huzefa Ahmadi, senior advocate, submitted that the decision of November 7, 2015, was a policy decision taken by the Union of India after thorough discussions between different stake-holders, inter-ministerial groups and finally a decision was taken.

Highlights

  • Supreme Court asked Centre whether it went back on its One Rank, One Pension policy for Armed forces
  • SC asked Centre whether it can consider automatic annual revision instead of the current policy
  • “Statement given by the Finance Minister during his speech does not become law” said the ASG

The Supreme Court Tuesday asked the Centre whether, after agreeing in principle to One Rank and One Pension (OROP) in Armed forces, it went back on its decision over automatically passing on any future enhancements in pension to the pensioners.

The top court asked the government whether it can consider automatic annual revision instead of the current policy of periodic review once in five years. A bench of Justices D Y Chandrachud, Surya Kant and Vikram Nath put these questions to Additional Solicitor General (ASG) N Venkatraman, appearing for the Centre, which tried to justify the notification of November 7, 2015.

“After Raksha Mantri (Defence Minister) announced in Parliament in 2014 that government has agreed in principle to grant One Rank One Pension (OROP) did the government at any point of time went back on its decision to automatically pass on the future enhancements in pension besides granting a uniform pension to personnel retiring in the same rank and length of service irrespective of the date of retirement,” the bench told Venkatraman.

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At the outset, senior advocate Huzefa Ahmadi, appearing for Indian Ex-servicemen Movement (IESM) which has challenged the decision of November 7, 2015, said it is arbitrary and mala fide as it creates a class within a class and effectively grants one rank different pensions. The ASG said that there are several judgements of the top court which said that statements given by ministers in Parliament are not law as they are not enforceable and as far as automatically passing of the future enhancements in pensions is concerned, it is “inconceivable” in any kind of services.

He submitted that the decision of November 7, 2015, was a policy decision taken by the Union of India after thorough discussions between different stake-holders, inter-ministerial groups and finally a decision was taken. “Announcement of Raksha Mantri (Defence Minister), discussions happening prior to a policy decision, how does it become enforceable.

Statement given by the Finance Minister during his speech does not become law, this is what the Supreme Court has held in various judgments,” the ASG said. He added that this court has held in series of judgments unless the policy decision is mala fide, manifestly arbitrary it cannot be touched. 

“The decision of November 7, 2017 was the decision of the Union of India. Even after this decision discussion had taken place, a committee was formed. Policy decisions are not easy one to make. Lot of thinking goes into it. A decision of this magnitude involves different buckets like economics, socio-economic, politics, psychology and budget,” he added. Venkatraman said the petitioners say that the base year for implementation of OROP should be prospectively from 2013 and not 2014 but then there will be no end to it.

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“Tomorrow another group will come and say it should be 2015. OROP seeks to bridge the gap in two ways. First, we have taken the lowest and the highest pension within that rank of pensioners, holding the same rank and same length of service to arrive at an average. Due to this, those who were below the average pension were brought up and those who were drawing higher pension were retained,” he said. The ASG added that secondly, the exercise of bridging the gap is to be carried out periodically once in five years.

“Every day or fifteen days personnel retire from the armed forces. If we go by the petitioners, We will have OROP every day. This is not conceivable. Hence, a conscious decision was taken to keep it at five years“, he said. Giving the figures, Venkatraman, said that estimated budget allocation for Defence pension is Rs 1,33,825 crore which is 28.39 percent of the total defence budget estimate of Rs 4,71,378 crore for the year 2020-21.

“This does not include budget on salaries, which is of the order of 34.89 percent of the total defence budget estimate for the year 2020-21,” he said, adding that the pension budget has steadily risen after implementation of OROP with effect from July 1, 2014. Venkatraman said that the payout/disbursement on account of arrears in the implementation of OROP approximately Rs 10,795.04 crore and the yearly recurring expenditure on account of OROP is Rs 7,123.38 crore.

During the hearing, Ahmadi said, “The notification of November 7, 2015, takes away the heart and soul of an earlier executive decision which was taken and is against the spirit and recommendation of the Koshyari Committee”. He submitted that the government cannot say that it is giving one rank and one pension but in effect give one rank and different pension in contrast to an earlier executive decision. The day long hearing remained inconclusive and would continue tomorrow.

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On July 11, 2016, the top court had sought reply from Centre on the plea filed by IEMS through advocate Balaji Srinivasan seeking implementation of OROP as recommended by the Koshyari Committee with an automatic annual revision, instead of the current policy of periodic review once in five years.

The IESM have challenged the Centre’s policy of periodic review of pension once in five years, saying such an approach was dilution of the February 26, 2014 announcement by which the revision in pension was to automatically pass on to the past pensioners on an annual basis. IESM has referred to the December 19, 2011, report of Rajya Sabha’s Petition Committee then headed by Bhagat Singh Koshyari which rejected all reservations advanced by the government while “strongly recommending” OROP. 

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