The Union Cabinet has approved the Unified Pension Scheme (UPS) for government employees in India. Effective from April 1, 2025. This new scheme aims to provide financial security and dignity to employees after retirement.
Unified Pension Scheme (UPS)
Under the UPS, employees with at least 25 years of service will receive a pension equal to 50% of their average basic pay from the last year of service. For those with shorter service, the pension will be proportional, ensuring a fair benefit for all.
Assured Pension Benefits
In the unfortunate event of an employee's death, their family will receive 60% of the pension amount that the employee was entitled to. This feature ensures that dependents are financially supported even after the employee's demise.
Family Pension Assurance
The UPS guarantees a minimum pension of ₹10,000 per month for those who have served at least 10 years. This safety net helps employees maintain a basic standard of living post-retirement.
Minimum Pension Guarantee
The pensions will be indexed to inflation, ensuring that the purchasing power of retirees is maintained over time. This adjustment is based on the All India Consumer Price Index, providing peace of mind against rising costs.
Protection Against Inflation
Employees will have the option to choose between the new UPS and the existing National Pension Scheme (NPS). This choice allows for a more tailored retirement plan, with UPS offering guaranteed benefits compared to the market-linked NPS.
Transition from NPS to UPS