After 8th CPC, Govt notifies Unified Pension Scheme for Central Govt Employees; check benefits

UPS has been introduced as an option within the National Pension System (NPS). The scheme will be available to central government employees who are already covered by NPS and choose to opt for UPS.

As per the notification dated January 24, 2025, the assured pension under UPS will be applicable only under the following conditions:

• On retiring after qualifying service of 10 years

• If the government retires an employee under the provisions of Fundamental Rules (FR) 56, which outlines the retirement guidelines for central government employees.

• On voluntary retirement after a minimum qualifying service period of 25 years. In this case, however, an assured pension will be provided from the date such such employee would have superannuated if the service period had continued till superannuation.

What are the benefits of UPS?

UPS offers assured payouts on retirement to central government employees. However, opting for this scheme is voluntary.

As per the notification, the scheme will provide fully and proportionally assured pensions depending on the period of qualifying services.

The fully assured pension will be applicable only after a minimum of 25 years of qualifying service. In this case, the pension amount of the retired employee will be equal to 50% of the average basic pay in the last 12 months before retirement.

In case of a lesser qualifying service period or voluntary retirement, the scheme will provide a proportionate payout as follows:

A minimum guaranteed pension of ₹ 10,000 per month in case of retirement after 10 years or more of qualifying service.

In case of voluntary retirement after a minimum of 25 years of qualifying service, the assured pension will commence from the date on which the employee would have superannuated if he had continued in service.

Dearness Relief payment

The pensioners opting for UPS will be eligible to get dearness relief (DR) on top of the assured payouts.

“The Dearness Relief will be worked out in the same manner as Dearness Allowance applicable to serving employees. Dearness Relief will be payable only when payout commences,” the notification said.

Lump sum payment

Employees opting for UPS will also be eligible for a lump sum payment equivalent to 10% of monthly Basic+DA for every six months of completed service.

The lump sum payment to an employee on retirement will not affect the assured pension offered under the scheme.

“A lump sum payment will be allowed on superannuation @10% of monthly emoluments (basic pay + Dearness Allowance) for every completed six months of qualifying service. This lump sum payment will not affect the quantum of assured payout,” the notification said.