Streamline pension pay-out for services

Amit Cowshish & Rahul Bedi

Ex-financial adviser, acquisition, MoD and Senior Journalist

For many service veterans, civilian ‘babus’, especially those handling financial matters, can do no right, and they pass up no opportunity to blame these ‘file-pushers’ for all that goes, or could go, wrong with either their salary and pension pay-outs, materiel acquisitions, or any other expenditure proposal needing fiscal concurrence.

Over decades, the armed forces have cut the Finance Division of the Ministry of Defence (MoD) and the Defence Accounts Department (DAD) no slack whatsoever, and are of the unwavering view that the raison d’être of them both is simply to harass veterans by tying them up in complex ‘babu’ knots.

Understandably, pension payments are emotive, and at times even a life-threatening matter for some veterans. But many in the armed forces are forever seeking to ambush the DAD, which is responsible for sanction, and to a limited extent, disbursement of pensions at the slightest wobble, however fleeting. This latter syndrome manifested itself yet again when the pensions of 58,759 service pensioners for April 2022 was ‘delayed’ by three days.

These retirees were among 4.47 lakh of the overall 33 lakh odd defence pensioners who were ‘migrated’ recently by the DAD to an automated sanction-cum-disbursement system called System for Pension Administration Raksha (SPARSH), centrally managed by the Principal Controller of Defence Accounts (Pensions) from Prayagraj. Presently, this programme remains a work in progress and is being rapidly implemented in phases to imminently cover all military and civilian pensioners.

Displaying visceral prejudice against the DAD, some senior service officers wrongly assumed in newspaper articles and on social media platforms that the ‘delay’ in disbursement of pensions had been ‘deliberate’ or on account of flaws in SPARSH’s software, a technical glitch in its overarching system, or possibly even both. In a droll display of self-righteousness, these veterans peremptorily berated the DAD for foisting an incipient software programme on hapless pensioners without first testing it out on a representative sample of the targeted demography.

Neither hypothesis is true. The reality is that the April 2022 pension was halted as the DAD had no intimation whether the affected pensioners had submitted their ‘Life Certificates’to the bank branches from where they routinely received their pensions. This certificate is to be submitted by all pensioners, including civilians, every November, though for 2021 this deadline was extended by the government to February 2022 due to the Covid-19 pandemic. However, following a high-level review by the DAD, the withheld pension was released within three days of it becoming due. The remaining pensioners, meanwhile, received their dues on time.

At the last count, some 36,000 of these 58,759 pensioners had still not submitted their Life Certificates leaving the DAD with a Hobson’s choice: stop pensions till the Life Certificate was submitted and incur the veterans’wrath and media vilification, or disregard the pension rules and continue with pension disbursement, despite the possible serious financial ramifications in the likely event of any pensioner’s demise previously. Pursuing the path of least resistance, and bereft of all ministerial backing, it is likely that the DAD would, like in April, opt for the latter course when the next lot of pensions fall due.

It was presumptuous on the part of some veterans to tutor the DAD on the modality of rolling out SPARSH. After all, the DAD is no novice in such matters; it was amongst the first lot of government departments to computerise its operations, beginning with Hollerith machines in the early 1960s before evolving in digitised sophistication over succeeding decades. Besides, SPARSH has been developed and installed by Tata Consultancy Services, the second most valued IT services brand globally which operates effectively in 46 countries.

One of the principal arguments voiced by service personnel against SPARSH is that a large population of pensioners living in the rural areas would be unable to avail of its services as many were not computer-savvy. They also averred that Internet connectivity across rural India was at best patchy and hence the SPARSH would be a non-starter. Such reproach too is ill-informed and baseless.

The reality of SPARSH is that service pensioners do not have to register or execute any operation on its portal for sanction or disbursement of pension. But for any assistance, they may require for tracking their accounts or submitting their ‘Life Certificates’, DAD has a Memorandum of Understanding with the Ministry of Electronics and Information Technology under which 4.5 lakh Common Service Centres across the country, down to the level of each of the 6,614 gram panchayats, are to assist veterans free of charge.

These burgeoning service centres — available every 5 km — can be accessed for data verification, grievance redressal and submission of Life Certificates. They are further supplemented by a network of 161 Regimental Record and other DAD offices and 861 branches of two public and one private sector banks. This network is soon set to expand further.

The naysayers further claim that SPARSH had cost Rs 158 crore to develop and instal. But reliable sources indicate that its advanced software, incorporating complex procedures, was developed for around Rs 10 crore, whilst another Rs 68 crore was expended on installing hardware and setting up two Disaster Recovery Centres at Faridabad and Mumbai. The remaining Rs 80 crore has been allocated for maintaining the entire system till March 2027 with all moneys sourced from the DAD’s internal budget.

As to its efficacy, SPARSH has so far eliminated the need for retirees to make physical visits to pension sanctioning and disbursing authorities and the dispersal of documents across various related offices. But critically, it has reduced the average period for sanctioning pensions for incumbent retirees from four months to just 17 days, for the first payment of gratuity and commuted pensions from one month to 1-2 days, and grievance redressal from 30 days to merely 3-4 days.

Despite the widespread efforts to digitise most financial operations in government departments, many retired armed forces personnel appear disinclined to accept such modernisation, preferring instead the age-old and laborious personnel-intensive process of pension pay-outs. In this context, service retirees need badly to realise that though change engenders insecurity and uncertainty, it mostly enables development and progress. The tendency to perpetuate hoary systems is simply not an option in the 21st century.

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