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Saturday, 19 September 2015

F"1:2200000 - Ratio" - Arithmetic of POTOs Pension.

F"1:2200000 - Ratio" - Arithmetic of POTOs Pension.
For the past 6 months or so, we have seen many veteran leaders coming on national television channels and speaking loudly about the injustice done to jawans in 1973,  by way of cutting down their pension from 70% ( a senior veteran confirmed it as 73%) to 50%.
This was projected as the primary reason for the OROP demand, not only for those whose pension was reduced but also for all!
It is altogether a different matter that the very same leaders who are now spearheading  OROP agitation,  were in active service when this injustice was perpetuated on us in 1973 and did pretty nothing to stop it!!!
It is not difficult to trace the reason. Their pension remained untouched at 50% and central government employees pension was enhanced from 33% to 50%.
I tried to analyse and unravel the Arithmetic behind this 70%(73%), 50% and 33%. To my mind it appeared that these rates were determined after careful consideration of  various factors. The primary one being the retirement age.
In 1973, central government employees superannuated at 58. Defence officers retired  at an average age of 50 and the POTOs retired at 33-37, the average being 35.
Thus the difference between the retirement age of civilians and defence officers was 8 years and the POTOs was 23 years.
The officers and POTOs respectively were getting 17% and 40% higher pension than civilians. From the above figures we can reasonably conclude that the defence personnel were getting nearly 2% extra pension over and above 33%, for every year of age  by which they retired early.
The rates of pension prevailed in 1973 perhaps had a sound logic and scientific approach. It appears to have had the following two elements ingrained in it:
1. "The service rendered" for which all were paid 33% of their pay as pension
2. "The service remained" upto 58 years of age,  for which the early retirees were paid nearly 2% extra pension per annum.
This fine and scientific balance would not have been disturbed, by the then government in 1973. May be it was due to 1:2200000 ratio! Ironically, this was done within 2 years of India winning the 1971 Bangladesh war.
Although the principle of 2% extra pension for early retirees appears to have been withdrawn overnight, in real terms officers lost nothing as their 50% pension remained untouched. But we the POTOs lost 23%.  Further, with the condition of 33 years for full pension, the pension of a jawan retired after 15 years service came to a meager (50x20)÷33= 1000÷33=33.33% of the pay drawn.
The GOI wants us to retire early to keep the armed forces young and fighting fit; yet they give us peanuts as pension.
If the above assumptions are correct then the so called OROP won't retrieve the lost ground and compensate POTOs adequately. The only way is to restore the 1973 pension formula with both the "service rendered" and "service remaining"elements ingrained in it. Pay to serving POTOs 50% of the pay as service pension and 1% ( if not 2%), extra pension for every year of service remaining upto 60 years.
This amounts to, a jawan  who is discharged after15 years of service at the age of 35,  getting a monthly pension of 50%+(25x1)=75% of the pay drawn, which isreasonable. At 36 he will get 74% ; at 37, 73% and at 40, 70% and so on. However the benefit of additional pension could be disallowed to those who opt for discharge on their own request. They will get only the service pension of 50%.
This will go a long way to help POTOs to settle in their post - discharge civil life. AFVAI should make this as part of it's agenda and work towards achieving it while GOI implements the 7th CPC recommendations.
Readers may kindly suggest pragmatic ways and means of achieving it at the earliest as the 7CPC recommendations will be out any time from now.
Kindly note that the above are purely my personal views and assumptions. This article might just help to build to our case and make our demand.
Sgt MPKaran
President
AFVAI, Karnataka Chapter

3 comments:

  1. These valuable statics should be forwarded to leading print media for the common peoples knowledge which will help us in our future struggle to get their support and sympathy.

    ReplyDelete
  2. It is a brilliant piece indeed. But the line "benefit of additional pension could be disallowed to those who opt for discharge on their own request. They will get only the service pension of 50%" might create confusion. I hope this is not meant for those who seek discharge on completion of the term of engagement.

    ReplyDelete
    Replies
    1. You are right sir. This will not include those who seek discharge on completion of the term of engagement.

      Regards, MPK

      Delete

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