The Centre has offered an option to the government employees of the Unified Pension Scheme (UPS) under the National Pension System (NPS). The UPS is the Centre’s new scheme and it was announced in August 2024. The new scheme has been launched for those employees who are already enrolled under the NPS. The UPS has been constituted with the benefits of the Old Pension Scheme (OPS) and National Pension System (NPS). The employees will get a definite pension under the scheme and it will help the employees to live a better life post their retirement. The plan will be implemented according to notification released on January 24, 2025.
Atal Bihari Vajpayee had introduced the National Pension System. The Unified Pension Scheme is an attempt to change the 21-year-old arrangement of the NPS. The UPS will offer a 50% amount of the last salary drawn of an employee as pension. The employee will also receive other benefits like Dearness Allowance, Family Pension and lump sum payment under UPS.
The UPS has similar features to the OPS. After the death of an employee, his family will receive 60% as family pension. Beside gratuity, the employee will receive a lump sum amount too. If an employee serves the central government for a minimum 10 years, he will be entitled to receive Rs 10000 as pension.
The Centre has clarified in the notification that an employee will not be able to claim any policy-related changes, exemptions, financial advantages, or similar pension scales to those of employees who will retire in the future. There will be two categories in the UPS: in the first, the employee and the government will both contribute, while in the second category, the government will provide the funding alone.
Earlier, the government had announced that all retired employees of the NPS will fall under the UPS. According to notification, the Pension Fund Regulatory and Development Authority (PFRDA) will decide what additional amount be paid to the retired employees of the NPS who will opt for the UPS.
