Couple of possible scenarios for you to consider:
1. Upon starting his NS, the soldier signs a 5 year contract. His NS is 2.5 years, the rest of his contract is 2.5 years. My understanding that in those days, that was the incentive for the soldier to sign on. In Neo's case, it didn't matter, because he kept signing on until he was recruited for elections.
2. Upon starting his NS, the soldier signs a 5 year contract, He serves his NS for 2.5 years, the contract is for 5 years after the completion of his NS. If this was the case for Neo, nobody would know the difference, because he kept signing on until he was recruited for elections.
In either scenario, he would have served his NS according to the law and his contract, and you would not even know he did.

