8th Pay Commission pension: What One Rank, One Pension demand means for Level 1-18 employees

The One Rank, One Pension (OROP) scheme is a prominent demand being raised by employee and pensioner bodies as the 8th Pay Commission consults stakeholders. OROP currently benefits Armed Forces personnel, Supreme Court and High Court judges, and the Comptroller and Auditor General of India.

Employee and pensioner bodies want a similar mechanism for Level 1-18 civilian central government employees. OROP could address disparities between pensions of civil employees who retired from the same designation at different points in time.

OROP is a pension parity scheme under which people who held the same post or level and rendered comparable qualifying service receive a comparable pension, irrespective of their retirement date. Pensioners who held the same post or level and rendered comparable service can currently receive different pensions because they retired under different Pay Commission regimes.

The central government introduced OROP for Armed Forces personnel in 2015, with financial benefits retrospectively effective from July 1, 2014. Retired judges of the Supreme Court and High Courts and the Comptroller and Auditor General of India also receive OROP benefits.

According to C Srikumar of AIDEF, earlier Pay Commissions had also addressed pension disparity. The 5th Pay Commission recommended updating pensions of pre-1986 retirees through notional fixation of pay as on January 1, 1986, using the formula applicable to serving employees.

It also recommended that consolidated pension should not be less than 50% of the minimum pay of the revised scale of the post held at retirement. The 7th Pay Commission recognised pension parity from the perspective of inter-temporal equity and referred to progressively bridging the gap between past and future pensioners.

AIDEF says notional fixation can bring past pensioners forward through successive Pay Commission revisions. It should consider the post/level held at retirement and career progression, rather than only the historical pay scale.

If the post is later upgraded, reclassified or moved to a higher level, earlier retirees from the same post should also be considered for the upgraded status, says AIDEF.

AIDEF recommends that pensions should ordinarily be fixed at 50% of the resultant notional pensionable pay. This would remain subject to the applicable minimum pension for the corresponding post/level and other statutory provisions.

AIDEF wants the 8th Pay Commission to consider:
● Post/level held at retirement
● Notional progression
● Corresponding pay applicable to that post/level
● Increments earned during service
● Promotions or career progression
● Subsequent revision or upgradation of the post/level