UPS FOR CENTRAL GOVT PENSIONERS W. E. F 1.4.25

[MOHAN P]

For Information:

As per Gazette notification dt. 24th Jan'25 of Ministry of Finance UPS comes into effect from 1st April. 2025.

The government announced the Unified Pension System (UPS) in August 2024 for all Central Government employees from. next FY. It can also be extended to State Government employees. 

Employees covered under the National Pension Scheme (NPS) can switch to UPS and get an assured pension amount. The UPS combines the features of the Old Pension Scheme (OPS) and the National Pension Scheme (NPS), ensuing assured pension amounts upon retirement.

See below the Illustration on calculation of pension on different scenario:

1.When a GOI employee with 25 yrs of service retire with basic pay of Rs. 6 lakhs pa. his/her average monthly basic pay would come to Rs. 50000/
As such his/her monthly pension would work out to Rs. 50000x(50/100)=25000/.

2.If an employee with 15 years of service with a basic pay of Rs. 4.80000 retires his/her average monthly basic pay would be Rs40000/ So monthly pension would  Rs. 40000x(50/100)x(15/25)=Rs.12000

3.With 10 yrs of service and B.Pay of Rs 3 lakhs pa. average B. Pay may come to Rs 25000.
Hence monthly pension would be Rs. 25000x(50/100)x(10/25)=Rs5000.
Since UPS provide  for a minimum pension of Rs. 10000/pm in this case pension would be at Rs. 10000/ instead of Rs5000/