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Unified Pension Scheme (UPS) takes effect from April 1: Know eligibility, benefits
UPS will be available to eligible central government employees who are already enrolled in the NPS as an option.
The Unified Pension Scheme (UPS), introduced by the central government as an alternative to the National Pension System (NPS), will come into effect on April 1, the government announced earlier this year.
UPS will be available to eligible central government employees who are already enrolled in the NPS as an option.
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UPS benefits and eligibility
The UPS was brought in due to an ongoing request from government employees for the reinstatement of the Old Pension Scheme (OPS) which ensured that retirees received 50 per cent of their final salary as pension.
Under the UPS, government employees will contribute 10 per cent of their basic salary, along with the dearness allowance (DA), while the government's contribution will increase to 18.5 per cent from 14 per cent earlier.
Apart from this, there will also be a separate pooled fund supported with an extra 8.5 per cent contribution from the government.
As a result, the UPS programme gives participants a pension equivalent to 50 per cent of the average basic salary from the last 12 months.
However, this benefit is available only to government employees who have completed at least 25 years of service. Employees with 10 to 25 years of service will receive a prorated pension amount.
In unfortunate events of a government employee's demise, the family members will receive 60 per cent of the pension.
It also gets superannuation benefits because in addition to gratuity, a lump sum payment is also provided upon retirement.
Employees with a minimum of 10 years of service will receive a pension of at least ₹10,000 per month.
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Employees who choose to retire voluntarily after completing at least 25 years of service will also be eligible with pension payments commencing from the employee's anticipated superannuation age.
Former retirees of the NPS who retired before the implementation of the UPS are also eligible to receive benefits under the scheme.
They will be provided with arrears for the previous period along with interest calculated based on the Public Provident Fund rates.
