Govt approves Unified Pension Scheme, know key features here

Union Pension Scheme: After several non-BJP-ruled states protested against the current New Pension Scheme, the union government on Saturday announced its latest offer for better retirement benefits for central government employees, called the Unified Pension Scheme. Here are the key features of the newly announced scheme. 

23 lakh to benefit

The announcement has come at a time less than a month before key state and Union territory elections. According to the government, some 23 lakh employees would now benefit accordingly.

Union Minister Ashwini Vaishnaw announced that UPS will benefit around 23 lakh central government employees who will get more security in their retirement.

50% of last salary as pension

Under the new scheme, staff will receive 50 per cent of the average basic pay of their last 12 months before retirement as a pension; provided they have served for a minimum of 25 years. For those with between 10 and 25 years of service, the pension will be proportionate to their years of service.

Minimum Pension and Family Support

UPS will also offer a minimum pension of Rs 10,000 per month for retirees who have rendered at least 10 years of service. In the event of the death of the employee while in service, his family will get 60 per cent of the amount of pension the employee was drawing at the time of his death, thus making them financially secure.

Date of Implementation

This new pension scheme will be implemented from April 1, 2025, for which the government has set apart Rs 6,250 crore in the first year itself. More importantly, the UPS would apply to those Central Government employees who retired under the NPS since 2004, giving them a new retirement option.

Inflation-Adjusted Pensions

Given the fact that costs of living are increasing, pensions under UPS shall be inflation-indexed. This would be by Dearness Relief based on the All India Consumer Price Index for Industrial Workers.