The central government has introduced the Unified Pension Scheme (UPS) for government employees. Because the National Pension System (NPS) was being constantly criticized, and the government was facing opposition from the employees. The employees were unanimously demanding the restoration of the Old Pension Scheme (OPS). But now the government has come up with UPS, finding a middle path.
Actually, the old pension scheme (OPS) was quite popular among government employees because it guaranteed a fixed pension based on the last salary. But there was no such system in NPS, due to which employees were demanding OPS, but now the government has given the option of UPS after a lot of brainstorming. If we look at the features of UPS, then in a way it is a middle path between OPS and NPS. It is not like OPS, but many things in it have been taken from OPS. Whereas UPS is much better than NPS.
Actually, employees have been continuously demanding guaranteed pension, which was a facility in OPS. But now in UPS, the government has put the ball in the court of employees by giving three guarantees. These three guarantees are also the biggest features of UPS.
1. First guarantee in UPS
Assured Amount: UPS will provide a fixed pension on retirement, which will be 50% of the average basic pay of 12 months. OPS also has a provision for a fixed pension at the time of retirement. Whereas in NPS there is no guarantee of a fixed pension at the time of retirement.
Condition:
The condition for this is that the service tenure of the employees should be 25 years. That means they will have to work for at least 25 years. If the service is less than 25 years and more than 10 years, then this amount will be given on the basis of pro-data. The formula is still awaited in this regard.
2. Second guarantee in UPS
Fixed family pension: Family pension will also be given under UPS, which is the second guarantee of the government, the family pension will be 60 percent of the basic salary of the employee. This pension will be given to the family of the employee immediately after his death. However, it is not yet clear whether if an employee dies in the first year, will his family also get pension on this basis. There is also a provision of family pension in OPS in case of death during service.
To understand this with an example, if an employee is getting a pension of Rs 30,000 per month, then after his death, his wife will get 60 percent of the pension, i.e. Rs 18,000 per month.
3. Third guarantee in UPS
Provision of minimum pension: Under UPS, if an employee retires after at least 10 years of service, he will get a minimum pension of Rs 10,000 per month. That is, there is a provision of a minimum pension of Rs 10,000 for 10 years of service in UPS. There is a provision of 40 percent pension commutation in OPS, whereas there is no such provision in NPS.
But if someone has worked for less than 10 years, will they not get pension? The picture is not clear about this yet, because the government says that a minimum monthly pension of Rs 10,000 will be given for at least 10 years of service. But what will be the provision for less service than that, there is suspense on this issue.
Apart from this, medical facility will be provided in UPS, whereas in OPS there is medical facility (FMA) after retirement, but there is no clear provision for this in NPS.
Let us tell you, UPS will be implemented from 1 April 2025. After implementing this scheme, an additional burden of Rs 6,250 crore will increase on the government treasury every year. The government has said that the central government employees will have the right to decide whether they remain in NPS or join UPS. This scheme will be applicable to all those who have retired under NPS since 2004.
What is Unified Pension Scheme (UPS)?
Unified Pension Scheme (UPS) is the new pension scheme for government employees. Under this scheme, employees will be provided a fixed pension, which is different from the New Pension Scheme (NPS), in which the pension amount was not fixed.