Wednesday, 19 August 2015

OROP: Prime Minister’s Assurance on One Rank One Pension

Prime Minister’s Assurance on One Rank One Pension

‘After hoisting the national flag at the Red Fort, the Prime Minister addressed the nation. Here are excerpts from the speech.’

“A number of governments have come and gone before us. They have all dealt with the One Rank One Pension problem. The scheme was presented to all of them. Each of those governments has given small assurances and promises on it, but the problem was never solved.

“I too give my word on this occasion, but this is not the word of an individual. This is the promise of this country of 125 crore people and I’m saying this as I stand in front of the tricolour at the Red Fort. We will accept and implement the One Rank One Pension policy. Talks are on with a number of organizations regarding this.

“The results of this talk will be in such a manner that it will support the development of one and all. Based on the talks, I’m convinced that good results will come out of it.

“Let me assure once again that One Rank One Pension policy has been accepted by the government. We will implement it after analyzing the main critical issues involved in it and talking to the stakeholders concerned.”


CSD facilities for Retired employees – MoD Order with Application Forms

CSD facilities for Retired employees – MoD Order with Application Forms


1. Refer Army Order 02/2006/QMG

2. Government of India has decided to extend the CSD Canteen facilities to the Retired Defence Civilian Employees vide MoD letter No. F.No.8(14)/2015-D(Mov) dated 31 Jul 2015.

3. Eligibility : Retired Defence Civilian Employees of following departments who were not entitled to avail CSD facilities will now be entitled for CSD facilities:
(a) Ministry of Defence including those working in their respective attached offices and those working in lower military formations.

(b) Defence Audit Departments.

(c) Executive Officer Cantonment Board

(d) Hindutan Aeronautics Ltd personnel retired from Air Force Station Hyderabad, Jorhat, Air Force Academy, Dundigal (Hyderabad) and Air Force Station Yelahanka(Bangalore)

(e) Indian Defence Accounts Services.

(f) Secretariat Border Roads Development Board and HQ Director General Border Roads.

(g) Retired employees of Canteen Stores Departments who are getting pension from CSD Fund.

(h) MES Employees.

4. Entitlement : They will be entitled for only Grocery Stores. No Liquor will be authorised.

5. Validity : The cards will have a validity of 10 years, from the date of issue and will be renewed every year.

6. Process for applying for Retired Defence Civilian Employees Card : All Retired Defence Civilian Employees will apply for the Smart Card to the URC through which they want to avail the Canteen facilities after authentication of the application.

7. Authentication : The application form will be authenticated for its correctness by the Department from which the employees has retired. The form will be countersigned by an officer not below the Rank of Under Secretary or equivalent.

8. Documents to be submitted to Department URC : The following attested documents will be submitted to the URC :
(a) Application for Canteen Smart card duly countersigned by the competent authority.
(b) Govt order for Retirement.
(c) Copy of Pension Payment Order (PPO)
(d) Address Proof and Copy of PAN card.
(e) Payment of Rs.135 to the URC.

9. Guidelines for Authenticating Authority:
(a) Each concerned department shoud appoint officer authorised to countersigned and promulgate orders and forward details to this office.
(b) Countersigned officer will verify that all columns are filled correctly prior to countersigned.

10. Guidelines for URC : Vetting of application will be done at URC for correctness. The following will be checked :
(a) That application is filled in all respect and no column is left blank.

(b) Signature of Countersiging authority.

(c) All personal particulars are checked for correctness with PPO and other supporting documents.

(d) In case an application is rejected the same will be informed to the applicant.

(e) New card will be sent by M/s. Smart Chip Ltd to the URC for issue to applicant. URC will check details with individuals Departmental retired identity Card prior to issue of new Canteen Smart Card.
(f) Since large number of applications are likely to be received intially at the URCs, the URC Manager must exercise due diligence while scrutinising and verifying the applications.

11. Guidelines for SCL : The following will be ensured ;

(a) All applications are sent by CCTS to M/s. Smart Chip Ltd, at the earliest.

(b) On receipt of application check for correctness with existing records through old Grocery Card Number.

(c) Verify applicants personal details through PAN No. on

(d) Ensure previous card of applicatin is hotlised prior to handing over of new card for Retired Defence Civilian Employees.

12. The application form (Blue Color) for Retired Defence Civilian Employees attached as Appendix will be made available in the URCs at the earliest by M/s. Smart Chip Ltd.

13. This letter be given vide publicity by displaying at prominent places like URSs, Station HQs, CAO and other controlling HQs.

Click to Download the ‘CSD Smart Card Application Format’ 
Page -1
Page -2

Click to view the order

Seventh Pay Commission seeks one-month extension from finance ministry

Seventh Pay Commission seeks one-month extension from finance ministry
The panel headed by A.K. Mathur is unlikely to recommend lowering of the retirement age or push for lateral entry and performance-based pay

New Delhi: The Seventh Pay Commission, headed by justice A.K. Mathur, has sought a one-month extension from the finance ministry and is preparing to submit its report by the end of September. The commission is unlikely to recommend the lowering of the retirement age as rumoured earlier or push for lateral entry and performance-based pay.
The commission, set up once in every 10 years to review pay, allowances and other benefits for central government employees, was appointed by the previous government on 28 February 2014 and was asked to submit its report in 18 months, which falls on 31 August.
“There are some data points that are missing, which we hope to get by this month end. We are trying to submit the report by 20 September,” an official of the commission said, speaking on condition of anonymity.
The Sixth Pay Commission had submitted its report a little ahead of its deadline on 24 March 2008. The revised pay scales were implemented retrospectively starting 1 January 2006, while recommendations relating to allowances were implemented prospectively.
The finance ministry apprehends that salary and pension expenditure will both rise by around 16% in 2016-17 as a result of the implementation of the Pay Commission recommendations. This may allow capital expenditure to grow by no more than 8% during the year, leaving little room to aggressively push for an infrastructure build-up.
“The Pay Commission impact may have to be absorbed in 2016-17. The phase of consolidation, extended by one year, will also be spanning out in this period. Thus, in the medium-term framework, the fiscal position will continue to be stressed,” the finance ministry said in the 2015-16 budget presented in February.
The official cited earlier said the Pay Commission report needs to be effective from 1 January 2016, or by April 2016 at the latest.
“It will be the government’s prerogative when to implement it. But beyond 1 January 2016, there will be arrears. But then, the government will be subject to criticism. Earlier, they had hidden behind Pay Commissions giving late reports,” he added.
However, the official said the commission is likely to maintain the status quo on the retirement age of central government employees, currently 60 years. “We are not going to either recommend lowering or raising the retirement age. If we lower the age limit, the pension burden will bust the government’s medium-term fiscal targets,” he added.
Asked whether government has sent any directives to the commission on the kind of hike it can afford, the official said the message it has got broadly is to keep the hikes low. “Merge the basic with dearness allowance, don’t stretch it beyond—that is the message. But that is a good message for the government to send. But there is no pressure otherwise. In fact, there is a lot of cooperation,” he said.
The official said merging basic pay with dearness allowance, which is mandatory, would itself mean a 155% rise for central government employees. “We have to decide how much to give above that. So, it will look good if you compare basic to basic,” he added.
On whether the commission will recommend performance-based pay bands, he said it will make some feasible recommendations, though he couldn’t guess if the government would accept them. The Sixth Pay Commission had also recommended performance-based pay revisions, but the government is yet to implement them.
“Eighty-eight percent of central government employees are industrial and non-industrial workers working with railways, post, paramilitary and army. So, performance-based pay revision is the wrong instrument for them. Biggest growth in government services is in paramilitary forces, where staffs in Central Reserve Police Force and Central Industrial Security Force have gone up by 75-80% in the last 10 years. By the time we have dealt with them, the bureaucracy is an afterthought. It does not affect anything,” he added.
D.K. Joshi, chief economist at rating agency Crisil Ltd, said the government is expected to be restrained in its pay hikes this time around, given the low inflation level and tepid growth momentum. “The last two Pay Commissions had significantly bumped up demand and fiscal deficit. But the government is unlikely to be populist this time. It has already showed restraint in the hike in minimum support prices for farmers,” he said.
However, Joshi said the Pay Commission will have a permanent income effect as well as a one-time impact through the payment of arrears, which will lead to increase in demand for consumer durables.

Read at: Livemint

Display CGEWHO’S Housing Scheme in all Central Ministry’s web site through NIC

Display details of the vacant dwelling units/unsold dwelling units in CGEWHO’S Housing Scheme in all Central Ministry’s web site through NIC: MHUPA Instructions

F. No. I-19011/6/2015-AA/FTS-13680
Government of India
Ministry of Housing & Urban Poverty Alleviation
(A.A. Section)

Nirman Bhawan, New Delhi
Dated: 18 August, 2015

Sub: Display CGEWHO’S Housing Scheme in all Central Ministry’s web site through NIC -Reg.
Based on the deliberation in the Executive Committee Meeting of Central Government Employees Welfare Housing Organization (CGEWHO), a decision has been taken to web publish details of the vacant dwelling units/unsold dwelling units in CGEWHO’S Housing Schemes in official website of different Ministries. 
Accordingly, CGEWHO has sent detailed web-link of its housing schemes where vacancies exist. A copy of the same is enclosed for appropriate action.
Encl. As above.
(A.N. Jha)
Under Secretary to the Govt. of India


Demand of One Rank One Pension by Defence, Railway, CG Employees vs New Pension Scheme: Opinion on LiveMint

Demand of One Rank One Pension by Defence, Railway, CG Employees vs New Pension Scheme: Opinion on LiveMint

How we should think about the One Rank One Pension issue
One parity we should be discussing is parity with central government employees who have been moved to a defined contribution scheme from defined benefit since 2004

Each of us has some link at a family level, direct or indirect, with the armed forces. A parent, a brother, an uncle, a cousin, a son, or a nephew. At a personal level, we know the first-hand stories of a wife not knowing if an ‘exercise’ will end in a dead husband. Of a father not knowing if the next landmine will have his son’s name on it. At a societal level, we can’t forget the border battles, and much closer home, the comforting presence of the army trucks and the green helmets as they rolled in after the 1984 riots to calm fires in West Delhi residential clusters. Can’t forget that when everything else fails in civic life, the army is called in to restore order. The army is called in not just to maintain order, but even for things like making that foot over-bridge that kept collapsing before the Commonwealth Games. And we have to only look over to our immediate northwest to see what damage an army can do to a nation.
How can the nation then say no to the one demand that the men in uniform are making—give us enough when we remove the uniform and lead civilian lives? The heart says it should be done. So why the delay? It could be that the answer is not always that simple. The One Rank One Pension (OROP) issue that seeks to index old pensioners to benefits that current ones get, has got all the ingredients of a perfect bomb: an emotive issue, kicked around by cynical politics of an outgoing government promising something it knew it would not be responsible for, an aspiring change maker who did not understand the multi-dimensional issue that OROP is and making a promise to implement it. And now a public stand-off between the veterans and the government.
Why is the issue so difficult to deal with? Why not just give the armed forces what they want? The issue is complicated on two counts (there are many other issues, of course, but I think these two are key). One, the country does not have the money over time to fund a rising bill of defined benefit (DB) pensions. DB pensions give the person retiring a certain percentage of his last salary, keeping in mind the number of years worked. DB schemes are ultimately un-fundable since declining populations find fewer people funding larger and larger numbers of the retired. Many countries across the world are in the process of moving away from DB plans. Two, and even more disastrously, OROP will open the doors for similar demands from other groups. Do Central Reserve Police Force soldiers deserve any less? What about the Indo-Tibetan Border Police? And the police? The first off the block has been the railway unions demanding OROP. “Railwaymen are performing dedicated service for the nation. Railway is the lifeline of the country. Employees are working round the clock across the country,” the general secretary of All India Railwaymen’s Federation was quoted as saying in a newspaper report. Other unions are waiting and watching, and once OROP is announced, expect a deluge of protests and court cases for parity.
The one parity we should be discussing today is parity with central government employees who have been moved to a defined contribution (DC) scheme from a DB since 2004. DC schemes put control of the future in the hands of the individual and what the state needs to do is design an efficient system that is fair to the social security seeker. India has a state of the art DC vehicle in the National Pension System (NPS). The costs are wafer-thin, the products are few so as to not freeze choice, and there is no fund manager risk since equity investing is restricted to index funds. For those unwilling or unable to choose the right fund, there is a default lifecycle fund that reduces equity as the person ages and moves into safer debt. The government should use the current focus on pensions to negotiate the move from DB to NPS for all categories of pensioners—those already on a DB, but, as was done with the civil services, from a given date, all new employees move to the NPS.
The armed forces have almost seven decades of goodwill banked, but an uncompromising demand irrespective of the consequences may change this equation. Unhappily for us, there are no recent academic studies that show what state pensions cost the nation. There is a 2006 paper that has some estimates (which are scary) and can be read here: . Even this old study clearly showed that DB pensions are unsustainable. Now to open the door for OROP for all categories of government employees will be a fiscal disaster for India. A more middle-of-the-road solution may be the only one that is sustainable without derailing the future of the country. No person who has defended the country against the dushman will want to see the country ship out gold one more time because OROP has opened the doors to a future that is unsustainable. If a middle-of-the-road solution is not acceptable, we only need to look west once again. This time, a little further than our immediate neighbour, to Greece, and see what runaway benefit bills can do to a nation. And because of the colour coding rules of the world, India should not expect the global multilateral agencies to expend the same kid gloves that Greece has been dealt with.
Monika Halan works in the area of financial literacy and financial intermediation policy and is a certified financial planner. She is editor, Mint Money, Yale World Fellow 2011 and on the board of FPSB India. She can be reached at

7TH CPC Will Increase Central Government Pay Only By 15% – Should We Accept?

7TH CPC Will Increase Central Government Pay Only By 15% – Should We Accept?

Big Expectations from 7th CPC and Low possibilities projected by Union Finance Minister!

Honourable Finance Minister Shri.Arun Jaitely had spoken about the possible impact of 7th CPC recommedations in Parliament.

The Speech is critically reviewed by Comrade Elangovan of DREU.

I am reproducting the comments of Comrade Elangovan for the consideration of our members:


1. The Medium Term Expenditure Framework statement has not yet been uploaded in Finance Ministry’s website.However I have taken the figures provided by print media including The Hindu.As per their statement the expenditure on salaries will rise by 9.56% in the fiscal 2015-16 as a result of 7th CPC implementation over the normal estimated expenditure in the 2015-16 budget to Rs.100619 crores. This means that the expenditure projected was Rs.91,839cr which if increased by 9.56% becomes Rs.100619 crores.

2. While going through the earlier framework statements I have come to the conclusion that the ‘salaries’ shown is pay with normal increments plus DA projected.

3. As per the estimated strength and provision there of statement laid as part of finance budget,the normal projection as PAY was Rs.60731 cr and so DA is Rs 31,108 as deducted from Rs 91 839 cr.The budget document does not give the DA expenditure separately. It gives the total expenditure on all allowances. I have therefore arrived at the figure based on calculations. However I have sought the expenditure on DA, HRA, and Transport Allowance separately through RTI.

4. The increase proposed is Rs.100619 cr from Rs.91,839 cr which means that there will be an increase of Rs.8780 cr. There won’t be any DA after 1-1-2016 up to 31-3-2016 in the fiscal 2015-16.Therefore the whole increase is on basic pay in this fiscal.

5. As we have already seen that the basic pay is Rs.60731 cr. the increase of Rs.8780 cr. is over this Rs.60731.This increase is 14.45% only.The expenditure projected for 2016-17 is Rs.1,12,000cr which is Rs.11,400 more over 2015-16 which works out to 11.32%. This is due to Increment, DA,HRA, TRA etc.The projection for 2017-18 is 1,16,000 cr.

6. If 40% of Basic Pay is to be given,the increase of expenditure in the fiscal 2015-16 must be Rs. 24000 cr as against the Rs. 8780 cr. The demand of JCM Staff side is that there must be an increase of 371% of basic pay as on 1-1-2016. With the 119% DA we would be drawing 219% already. The real increase demanded is 152% of Basic Pay. So not the 152% or 40% of 5th and 6th CPC is intended to be given to us. Only around 15% is going to be given. As The Terms Of Reference of 7TH CPC directs them to recommend only what is ‘FEASIBLE AND DESIRABLE’ to the Government.Now the Government In Parliament states only 15% is FEASIBLE AND DESIRABLE. ARE WE TO ACCEPT IT.? Some PSUs got 15%. But that is for 5 years. But for Central Government Employees it is for Ten Years. Are We To Accept?

7. Pension expenditure for civilian pensioners was estimated to be Rs.27,145cr and defence pension Rs.54,500 cr. The total is Rs.81645 cr. This is expected to go up to Rs.88521 cr, which is an increase of Rs.6876 cr.As there will be no Dearness Relief for the fiscal 2015-16 the increase is to be accounted only to Basic Pension.

8. I have sought the expenditure break up for dearness relief under RTI. However the rough calculation shows a near increase of same 15% in Pension.

9. The impact of 6th CPC on expenditure as per estimated strength of establishment and provision there of in respect of Central Government civilian employees was as follows:

ARREARS Rs 26084 cr. For three years mostly on Pay and DA regular PAY Increase per annum: Rs 8685 cr. These are actual figures.The 219% ofRs. 8685 cris Rs.19000 cr. EVEN THIS IS NOT GIVEN.

10.We must issue a warning to the government afresh demanding acceptance of our demand.I recall my earlier note where in I had quoted Bibek Debroy’s report that the 7th CPC will not be that destabilising to the Government as that of 6th CPC. GOVERNMENT PROVES THAT.


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