Union Cabinet approves revision of pension of Armed Forces Pensioners/family pensioners under One Rank One Pension w.e.f. July 01, 2019

The Union Cabinet, headed by Prime Minister  Narendra Modi, has approved revision of pension of Armed Forces Pensioners/family pensioners under One Rank One Pension (OROP)w.e.f.July 01, 2019. Pension of the past pensioners would be re-fixed on the basis of average of minimum and maximum pension of Defence Forces retirees of calendar year 2018 in the same rank with the same length of service.

Beneficiaries

The Armed Forces Personnel retired up to June 30, 2019{excluding pre-mature (PMR) retired w.e.f.July 01, 2014} will be covered under this revision. More than 25.13 lakh (including over 4.52 lakh new beneficiaries) Armed Forces Pensioners/family pensioners will be benefitted.Pension for those drawing above the average shall be protected.The benefit would also be extended to family pensioners, including war widows anddisabled pensioners.

Arrears will be paid in four half-yearly instalments. However, all the family pensioners, including those in receipt of Special/Liberalised Family Pension and Gallantry Award Winners, shall be paid arrears in one instalment.

Expenditure

The estimated annual expenditure for the implementation of the revision has been calculated as approx. Rs 8,450 crore @31% Dearness Relief (DR). Arrears w.e.f.July 01, 2019 to December 31, 2021 have been calculated as over Rs 19,316 crore based on DR @ 17% for the period from July 01, 2019 to June 30, 2021 and @31% for the period from July 01, 2021 to December 31, 2021. Arrears w.e.f.July 01, 2019 to June 30, 2022 have been calculated as appox. Rs23,638 crore as per the applicable dearness relief. This expenditure is over and above the ongoing expenditure on account of OROP.

Rank wise likely estimated increase (in rupees) in service pension under OROP w.e.f. July 01, 2019:

Rank Pension as on 01.01.2016 Revised pension w.e.f. 01.07.2019 Revised pension w.e.f. 01.07.2021 Likely arrears from 01.07.2019 to 30.06.2022
Sepoy 17,699 19,726 20,394 87,000
Naik 18,427 21,101 21,930 1,14,000
Havildar 20,066 21,782 22,294 70,000
Nb Subedar 24,232 26,800 27,597 1,08,000
Sub Major 33,526 37,600 38,863 1,75,000
Major 61,205 68,550 70,827 3,05,000
Lt. Colonel 84,330 95,400 98,832 4,55,000
Colonel 92,855 1,03,700 1,07,062 4,42,000
Brigadier 96,555 1,08,800 1,12,596 5,05,000
Maj. Gen. 99,621 1,09,100 1,12,039 3,90,000
Lt. Gen. 1,01,515 1,12,050 1,15,316 4,32,000

Background

The Government took a historic decision to implement OROP for the Defence Forces Personnel/family pensioners and issued policy letter on November 07, 2015 for revision of pension w.e.f.July 01, 2014. In the said policy letter, it was mentioned that in future, the pension would be re-fixed every 5 years. Approx. Rs 57,000 crore has been spent @Rs 7,123 crore per year in eight years in the implementation of OROP.

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