Government notifies Unified Pension Scheme for government employees
The government had set up a high-level committee, headed by cabinet secretary-designate T.V. Somanathan, the then-finance secretary, in April 2023 to rework the existing pension system, known as the New Pension Scheme (NPS).
Government notifies Unified Pension Scheme for government employees
Centre has officially notified the implementation of the Unified Pension Scheme, UPS. The government introduced the Unified Pension Scheme in August last year, as an option under the National Pension System for Central Government employees. The scheme will come into effect from 1st April this year.
The notification issued yesterday stated that UPS shall apply to Central Government employees who are covered under the National Pension System and who choose this option under NPS. “The Unified Pension Scheme shall apply to Central Government employees who are covered under the National Pension System and who choose this option under the National Pension System,” the finance ministry said in a statement.
“Pension Fund Regulatory and Development Authority (PFRDA) may issue regulations for operationalizing the UPS. The effective date for operationalization of the Unified Pension Scheme shall be April 1, 2025,” the statement added.
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Existing central government employees and future employees can choose to either take the UPS option under the NPS or continue with the NPS without the UPS option. According to the notification, any employee who has exercised the UPS option cannot claim any other policy concession, policy change, financial benefit, or any parity with subsequent retirees later including post-retirement.
The new Unified Pension Scheme (UPS) will offer 50% of the average basic pay drawn by a Central government employee during the 12 months before retirement, provided they complete 25 years of service. Employees with less than 25 years of service but more than 10 years will receive a pension on a proportionate basis.
Read Also : NLCIL signs MoU with IIM Nagpur for capacity building training programsThe union cabinet approved the new pension policy for nearly 2.3 million central government employees on August 24, 2024. The policy unveiled a framework that guarantees 50% of basic pay as a monthly pension, responding to requests from Central government staff unions who sought guaranteed retirement benefits.
The government had set up a high-level committee, headed by cabinet secretary-designate T.V. Somanathan, the then-finance secretary, in April 2023 to rework the existing pension system, known as the New Pension Scheme (NPS).
This move followed widespread grievances that had escalated into a political issue, with some states, where opposition parties were in power, reverting to the old pension scheme (OPS), which had strained the government’s financial resources.
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