Government introduces ‘Unified Pension Scheme’, will benefit 23 lakh central employees

| Updated: 25 August, 2024 1:12 pm IST

Union Minister Ashwini Vaishnaw outlined the key features of the UPS, emphasising its foundation on five essential pillars.

NEW DELHI: The Union Cabinet has approved the Unified Pension Scheme (UPS) for Central government employees.

The new scheme is set to benefit approximately 23 lakh employees, providing them with the option to choose between the existing National Pension Scheme (NPS) and the newly introduced UPS.

Union Minister Ashwini Vaishnaw outlined the key features of the UPS, emphasising its foundation on five essential pillars, with the most significant being the assured pension. This pillar addresses the primary demand of government employees for a guaranteed income post-retirement.

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Under the scheme, retirees will receive 50% of their average basic pay from the last 12 months of service, provided they have completed at least 25 years of service. For those with 10 to 25 years of service, the pension will be proportionate to their tenure.

In addition to the assured pension, the UPS offers other critical benefits aimed at enhancing financial security for employees and their families.

The assured family pension ensures that, in the event of an employee’s demise, their family will receive 60% of the pension the employee was receiving before their death. This provision is crucial for safeguarding the financial well-being of dependents.

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Moreover, the UPS guarantees a minimum pension of ₹10,000 per month for employees who have served at least 10 years.

This assured minimum pension is particularly beneficial for lower pay scale employees, offering a vital safety net against inflation and financial uncertainties in retirement.

This landmark decision by the government is expected to significantly enhance the financial security of millions of central government employees and their families, providing them with greater peace of mind in their post-retirement years.