The management of defence pensions has been taxing the capabilities of the Ministry of Defence for decades. The implementation of the One Rank One Pension or OROP) scheme has turned into a legal and bureaucratic battleground. Some ex-Servicemen have locked horns with the Executive and the Judiciary, but justice remains elusive. Even the refixing of pension every five years that was due in 2019 has not been done. The reasons for the delay are revealing of the awkward consequences brought about by the interplay of multiple actors.
The Ministry of Defence (MoD), it is said, has not refixed the pensions on the due date since the issue was sub-judice. An unrepresentative group of ex-Servicemen had filed a case in the Supreme Court that the MoD was violating the OROP principle by replacing it with ‘One rank multiple pensions’ for persons with the same length of service. On 16 March 2022, the court dismissed the case and directed the re-fixation to be carried out from 1 July 2019 and arrears paid within three months.
Three months have elapsed on 16 June 2022 without implementation of the SC’s direction. Technically, it opens the door for contempt of court. The reason for this delay obtained through a Request For Information (RFI) has indicated that on 30 May 2022, a note was initiated by the Department of Ex-Servicemen’s Welfare in the MoD that various types of pension tables will be required to be prepared by the Controller General of Defence Accounts (CGDA), which is a time-consuming process and therefore the SC be requested to grant minimum three months more. Since then, no other proceedings involving the SC has come to light. Pensioners continue to wait.
On 29 July, Ajay Bhatt, the minister of state in the MoD, in reply to an unstarred question in the Lok Sabha on the implementation of the three months for refixation, replied that it was ‘under process’. What was left unsaid was that various executive arms of the government were overwhelmed by the effort required to implement the ruling of the SC. The CGDA, the prime institution involved, has had years to formulate draft pension tables – a task that should not be so daunting in the computer age and yet they are asking for more time.
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Is SPARSH any good?
It is against this backdrop the CGDA has taken on more responsibility for itself and launched another scheme called SPARSH (System for Pension Administration) related to defence pension management. The initiative claims to be derived from the vision of Digital India, Direct Benefit Transfer and ‘minimal government, maximum governance’. In essence, it centralises the complete cycle of pension that includes initiation, sanction, disbursement, revision, service and grievance management under a single entity, the Defence Accounts Department.
SPARSH received negative publicity when over 50,000-odd defence pensioners who had been migrated to the scheme did not reportedly receive their pension in the month of April 2022. Apparently, their annual life certificates had not been received and the algorithm had done its job. The issue was immediately resolved and the pension disbursed. The pensioners were given more time to send their certificates. The episode however reflects a larger problem about assumptions related to leveraging Digital India.
Digitisation permits greater centralisation but simultaneously increases vulnerability. There are currently approximately 26 lakh defence pensioners and the number will only grow with time. When housed in a single system like SPARSH, its vulnerability to a cyber-attack cannot be ignored. Amongst other issues, a cyber-risk assessment should have given cause for caution. But even if it was done, it seems to have been overshadowed by the main argument – purportedly for saving money, sweet music to the ears of the bureaucracy and politicians.
The existing system of pension disbursement has public and private sector banks as intermediaries for which they charge a certain fee. SPARSH, it is said, requires no intermediaries. But for sure, it will require enhanced numbers of personnel and also infrastructure. Both these demand short-term and long-term financial outlays that may undermine the primary logic of savings. The existing system was partially outsourced, but the plan is to make it a purely governmental enterprise. So, it does not support the notion of ‘minimum government, maximum governance’.
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Time for defence ministry to review
I am a defence pensioner and I have asked many of my acquaintances across the military rank structure about the efficacy of the old system of disbursing pension. I am yet to receive any negative feedback on that score. On the other hand, pension grievances mostly pertain to the Department of Ex-Servicemen’s Welfare, CGDA, and their interpretations of rules and their manner of dealing with court rulings. SPARSH does not in any way appear to rectify such problems, at least not in any reasonable timeframe, because inadequacies of human agencies cannot be possibly compensated by a centralised digital system like SPARSH.
Whatever be the eventual result, there is no denying the fact that the CGDA would have expanded its empire – whether personnel, infrastructure or control. Most grievances of pensioners are likely to continue facing indifferent inaction from the bureaucracy. The only beneficiary would be the CGDA in terms of its vastly increased power and attendant benefit thereof. At the same time, cyber vulnerability would also have expanded in scope. Mere publicity drives cannot solve these issues.
However, SPARSH can be halted in its tracks, if the provision that is available on its website regarding migration from the old system to new requiring individual consent is activated. It won’t be surprising if an overwhelming majority of the remaining pensioners—who are still a significant majority—opt out. If, however, it is accompanied by a provision that in the event of failing to exercise their option for migration their assent will be assumed, the system could incorrectly show sizeable bloated numbers opting for it. In fact, if most pensioners are allowed to voice their opinion, they would broadcast the fact that their spouses (many of whom are barely educated) still live in a world that is distanced from the Digital India that SPARSH seems to take for granted and wishes to leverage.
Taken together, the failure of the CGDA to implement the revised OROP scales and the decision to go for SPARSH should loudly ring alarm bells for the defence minister. He needs to realise that he has, in all probability, been sold a plot that is based more on hot air than fact.
Lt Gen (Dr) Prakash Menon (retd) is Director, Strategic Studies Programme, Takshashila Institution; former military adviser, National Security Council Secretariat. He tweets @prakashmenon51. Views are personal.
(Edited by Neera Majumdar)