Short Article
07-09-2024 | 17:51 PM
Unified Pension Scheme (UPS)
Recently, the Union Cabinet approved the Unified Pension Scheme by replacing the National Pension Scheme (NPS).
Key Highlights
- It is based on the recommendations of the T.V. Somanathan Committee (2023).
- It will be effective from April 1, 2025.
- The Unified Pension Scheme is proposed to combine the advantages of both the Old Pension Scheme (OPS) and the New Pension Scheme (NPS).
- It aims to provide long-term financial security and pensions to government employees while maintaining flexibility and choice.
- Central government employees have the option to choose between NPS and UPS.
Key elements of the Unified Pension Scheme (UPS)
- The UPS assured a pension to government employees equal to 50% of the average basic pay drawn over the last 12 months before superannuation.
- Minimum Qualifying Service: Employees with a minimum qualifying service of 25 years will receive a full assured pension.
- Assured minimum pension: 10,000 per month on superannuation after a minimum of 10 years of service.
- Family Pension: Assured family pension at 60% of the last pension in case of death of the employee.
- Government Contribution: Government contribution stepped up from 14% to 18.5% while employees remained at 10%.
