The government is introducing a new pension scheme for central government employees starting from April 1, 2025. This scheme, called the Unified Pension Scheme, was approved by the Union Cabinet in August 2024. It aims to provide better financial security to employees after retirement. With this new scheme, around 23 lakh central government employees will receive benefits that could help them plan their future more easily.
As the new financial year begins on April 1, 2025, many important changes will take place. The Unified Pension Scheme is one of the biggest updates for central government employees. This scheme is designed to improve the existing pension system and ensure employees have a stable income after they retire. Employees must stay informed about the details of this scheme to understand how it will impact their savings and future financial plans.
Key Features of the Unified Pension Scheme (UPS)
| Feature | Details |
|---|---|
| Selection Option | Employees can choose between NPS (National Pension System) and UPS. |
| Fixed Pension | Employees retiring after 25 years get 50% of the average basic salary from the last 12 months. |
| Proportionate Pension | Employees with 10 to 25 years of service get pension based on their service period. |
| Minimum Pension | Employees with at least 10 years of service get a minimum pension of Rs 10,000 per month. |
Family Pension Benefits
If a central government employee passes away, their family will receive 60% of the employee’s pension. Contributions to the scheme are as follows:
| Contribution | Percentage |
|---|---|
| Employee | 10% of basic salary |
| Government | 18.5% of basic salary |
| Government (NPS Contribution) | 14% |
This scheme is available to central government employees under NPS who meet the minimum 10-year service requirement.
FAQs
Who is eligible for UPS?
Employees under NPS with at least 10 years of service can opt for UPS.
Can an employee switch between NPS and UPS?
No, employees must choose either UPS or NPS permanently.
What happens if an employee retires before 10 years of service?
They will not qualify for a pension under UPS.
How much pension will be given to a family after the employee’s death?
The family will receive 60% of the employee’s pension.
When will UPS be implemented?
UPS will be effective from April 1, 2025.