(MENAFN- Kashmir Observer) New Delhi- In a big announcement ahead of assembly elections in Jammu and Kashmir and Haryana this year, the government has launched the Union Pension Scheme (UPS) amid protests by several non-BJP-ruled states over the New Pension Scheme (NPS).
“This scheme will benefit 23 lakh central government employees,” announced Union Minister Ashwini Vaishnaw. The new scheme will be implemented from April 1, 2025 and employees will have the option to choose between the NPS or UPS.
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The UPS, approved by the Union Cabinet chaired by Prime Minister Narendra Modi, aims to give assured pension, family pension and assured minimum pension to government employees:
1. Assured Pension:
The scheme assures 50 percent of the average basic salary for the last 12 months before retirement as pension for government employees who complete a minimum of 25 years in service. It will be proportionate for a shorter service period upto a minimum of 10 years of service.
2. Assured Family Pension:
In case of death, the pensioner's family will get 60 percent of the pension received at their time of death.
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3. Assured Minimum Pension:
The scheme assures
₹
10,000 per month after retirement for government employees after minimum 10 years of service.
As per the current pension scheme, employees contribute 10 per cent while the central government contributes 14 percent, which would be increased to 18 percent with the UPS.
“Some central employees met with the Prime Minister today. They were with the UPS in the meeting,” said Vaishnaw.
Last year, a committee under Finance Secretary TV Somanathan was set up to review the pension scheme for government employees and suggest changes in the light of the existing framework and structure of the National Pension System.
The finance ministry formed the committee after several non-BJP-ruled states decided to revert to the Old Pension Scheme (OPS) and calls by employee organisations for the same.
Under the OPS, retired government employees received 50 per cent of their last-drawn salary as monthly pensions. The amount keeps increasing with the hike in the Dearness Allowance (DA) rates.
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