(MENAFN- IANS) New Delhi, Aug 24 (IANS) The Union Cabinet chaired by Prime Minister Narendra Modi on Saturday approved the Unified Pension Scheme (UPS) for government employees, which will provide an assured minimum pension and a family pension.
Around 23 lakh Central government employees will benefit from the Unified Pension Scheme. These employees will now have the option to choose between the New Pension Scheme (NPS) and the Unified Pension Scheme.
The state governments will also be given the option to opt for the Unified Pension Scheme. If the state governments opt for UPS, the number of beneficiaries will be around 90 lakh. According to the government, the expenditure for arrears will be Rs 800 crore. The annual cost increase will be around Rs 6,250 crore in the first year.
The scheme will be effective from April 1, 2025.
Central government employees will be given the option of choosing between NPS and UPS. The existing Central government NPS subscribers will also be given the option to switch to UPS.
Highlights of Unified Pension Scheme:
* Assured pension of 50 per cent of the average basic pay drawn over the last 12 months prior to superannuation for a minimum qualifying service of 25 years
* Proportionate for lesser service up to a minimum of 10 years of service
* Assured Family Pension @ 60 per cent of pension of the employee immediately before her/his demise
* Assured Minimum Pension @ Rs 10,000 per month on superannuation after minimum 10 years of service
Briefing journalists after the Cabinet meeting, Union Minister Ashwini Vaishnaw said the Centre constituted a committee which held as many as 100 meetings with several top organisations, including the RBI and the World Bank, on the issue.
The UPS has been approved by the Cabinet based on the recommendations of this committee.
"Today, the Union Cabinet has approved the Unified Pension Scheme (UPS) for government employees providing for an assured pension. A 50 per cent assured pension is the first pillar of the scheme, while the second pillar will be an assured family pension,” the Minister explained.
On the spadework that went into the new scheme, the Minister said,“Government employees demanded some changes in the New Pension Scheme. For this, PM Modi constituted a committee under the chairmanship of Cabinet Secretary T.V. Somanathan. This committee held more than 100 meetings with different organisations and nearly all the states and the Unified Pension Scheme has been formulated based on these recommendations.”
“There's a difference between how PM Modi works and how the opposition functions. Unlike the opposition, PM Modi believes in holding extensive consultations,” Vaishnaw added.
MENAFN24082024000231011071ID1108596496
Legal Disclaimer:
MENAFN provides the information “as is” without warranty of any kind. We do not accept any responsibility or liability for the accuracy, content, images, videos, licenses, completeness, legality, or reliability of the information contained in this article. If you have any complaints or copyright issues related to this article, kindly contact the provider above.