Under this scheme, there is a provision to give 50 percent of the average basic salary received in the 12 months before retirement as a guaranteed pension. Recently, the Pension Fund Regulatory and Development Authority (PFRDA) had issued a notification in this regard.
7th pay commission latest: The new financial year is going to be very special for central employees. We are saying this because the government’s Unified Pension Scheme (UPS) is going to be implemented from April 1. With the implementation of this scheme, central employees will have a new option for pension. Let’s know the details.
About Integrated Pension Scheme
Under this scheme, there is a provision to give 50 percent of the average basic salary received in the 12 months before retirement as a guaranteed pension. Recently, the Pension Fund Regulatory and Development Authority (PFRDA) had issued a notification in this regard. This notification follows the UPS notification issued by the government on January 24, 2025 for central government employees coming under the National Pension System (NPS). According to PFRDA, the rules related to UPS will come into effect from April 1, 2025.
Effective from April 1
These rules enable enrolment of Central Government employees, including existing Central Government employees in service as on April 1, 2025, into NPS and employees recruited in Central Government services on or after April 1, 2025. Enrolment and claim forms for all these categories of Central Government employees will be available online on the Protege CRA website from April 1, 2025. Employees also have the option of submitting the form physically.
What is in the notification
According to the notification, UPS or assured payment option will not be available in case of removal or dismissal or resignation of the employee from service. The notification states that the rate of full assured payment will be 50 per cent of the average basic salary of 12 months immediately before retirement and subject to minimum qualifying service of 25 years. The notification will give 23 lakh government employees the option to choose between UPS and NPS. NPS came into effect on January 1, 2004.
How is it different from the old pension scheme
Let us tell you that under the Old Pension Scheme (OPS), which was effective before January 2004, employees used to get 50 per cent of their last basic salary of their tenure as pension. Unlike OPS, UPS is of contributory nature. In this, employees will have to contribute 10 per cent of their basic salary and dearness allowance, while the contribution of the employer (Central Government) will be 18.5 per cent. However, the final payment depends on the market return on the fund, which is mostly invested in government bonds.
