The Unified Pension Scheme (UPS) is a significant development for Central Government employees, offering a comprehensive structure for retirement benefits under the National Pension System (NPS). With the scheme set to be operational from April 1, 2025. This post provides a detailed breakdown of the UPS, including eligibility criteria, benefits, contributions, and how it compares with existing pension options.
Here are the key points of the Unified Pension Scheme (UPS) Gazette notification:
1. Eligibility for Assured Payout:
- Employees with 10 years of qualifying service at superannuation.
- Employees retiring under FR 56(j).
- Employees opting for voluntary retirement with 25 years of service, payout starts from superannuation age.
2. Ineligibility for Assured Payout:
- Employees dismissed, removed, or who resign from service.
3. Payout Details:
- Full payout: 50% of the last 12-month average basic pay after 25 years of service.
- Proportionate payout for lesser qualifying service.
- Minimum Rs. 10,000 payout for employees with 10+ years of service.
- Family payout of 60% for the spouse after the employee’s death post-superannuation.
4. Additional Benefits:
- Dearness Relief will be applicable on payouts.
- Lump sum payment at superannuation (10% of monthly emoluments for every 6 months of service).
5. Contributions:
- Employee contributes 10% of (basic pay + DA); Government matches it.
- An additional 8.5% contribution from the Government to a pool corpus.
6. Investment and Management:
- Employees can choose investment options for their individual corpus, regulated by the Pension Fund Regulatory and Development Authority (PFRDA).
- Government manages the pool corpus.
7. Unified Pension Scheme for Existing Employees:
- Employees can choose between the Unified Pension Scheme and the National Pension System (NPS).
- Contributions from the NPS will be transferred to the individual corpus under UPS.
8. Retirement and Transfer of Funds:
- On retirement, employees authorize the transfer of individual corpus to the pool corpus, adjusting for any shortfall.
- If the individual corpus exceeds the benchmark, the excess remains with the employee.
9. Payout Mechanism:
- If the individual corpus value is less than the benchmark, proportionate assured payouts will be given.
10. Past Retirees:
- The scheme applies to past retirees of the NPS, with arrears paid along with interest.
11. Policy Restrictions:
- No other policy benefits or financial claims are allowed for employees opting for UPS.
12. Regulatory Framework:
- The PFRDA may issue additional regulations to operationalize the UPS.
13. Effective Date:
- The UPS will be operational from April 1, 2025.
14. Disciplinary Proceedings:
- Employees under disciplinary action at superannuation will have separate provisions for assured payouts.
In conclusion, the Unified Pension Scheme (UPS) Gazette notification outlines the eligibility, benefits, and operational guidelines for employees choosing to opt into the scheme. While the information provided here summarizes the key aspects, it is essential for employees to refer to the official Gazette notification for precise details and to fully understand the conditions, contributions, and implications related to the scheme. This ensures clarity on the specific requirements and the correct application of the provisions laid out in the notification.