UPS: If you are a retired central government employee, there is some significant news for you. The government, in a written response in the Lok Sabha, has revealed that there are 25,756 retired central government employees who are eligible for extra benefits under the Unified Pension Scheme (UPS). The government also mentioned that as of July 9, 2026, 12,258 claims have been made under this scheme, out of which 9,823 have been processed, and benefits have been distributed.
This update was shared by Minister of State for Finance, Pankaj Chaudhary, in the Lok Sabha. He explained that the UPS was introduced as an alternative for central government employees enrolled in the National Pension System (NPS).
Currently, there are no intentions to extend the scheme to other areas. The government has clarified that there are no immediate plans to broaden the UPS benefits to other pension schemes or employees from different sectors. This means that the UPS will remain exclusive to central government employees under the NPS. As per government records, out of the 25,756 eligible retired employees, 12,258 have applied for the UPS additional benefits. Among these, 9,823 claims have been processed, while the rest are still being reviewed.
What is the Unified Pension Scheme (UPS)?
The UPS is a recent pension initiative launched by the central government for government employees, kicking off from April 1, 2025. It was introduced as an option for central government employees covered by the NPS. While the NPS is influenced by market changes, the UPS strives to offer a fixed pension amount. The UPS follows the same tax regulations as the NPS. The 10% contribution made by the employee is tax-deductible under Section 80CCD(1). The UPS is viewed as a tax-efficient choice within the NPS structure.
Understanding the UPS regulations: Pension calculations under the UPS are simple. Those with at least 25 years of service will receive a pension equal to 50% of their average basic salary for the 12 months before retirement. For service periods below 25 years, the pension will be adjusted accordingly. Employees with a minimum of 10 years of service are guaranteed a pension of Rs 10,000 per month. Additionally, those opting for voluntary retirement after 25 years of service will start receiving their pension from the usual retirement date.