A big and important news is coming for the employees of the Central Government! With the aim of providing more financial security to the employees working under the National Pension System (NPS),the Unified Pension Scheme (UPS) is going to be implemented from 1 April 2025.
The benefit of this scheme will be available to those government employees who have completed at least 10 years of service. The most important thing is that under UPS,50% of the average basic salary of the 12 months just before retirement will be available as a pension! So let us know every important thing related to this scheme in detail so that you too can make your retirement plan even more secure.
Great features of the Unified Pension Scheme
The Unified Pension Scheme (UPS) will be an alternative scheme under NPS for existing and new employees of the Central Government. After joining this scheme,employees will get many important benefits:
This scheme will be available as an optional option under NPS for central government employees. Employees can choose it as per their wish.
Employees have to contribute 10% of their Basic Salary and Dearness Allowance (DA) every month.
To choose this scheme,the government employee has to apply within 30 days of his joining.
Employees who have been employed for more than 12 months can also enroll in it within the next three months.
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Which government employees will get the benefit of this scheme
To avail of the Unified Pension Scheme (UPS),employees have to fulfill some eligibility criteria:
An employee who has completed 10 years of service will get a minimum pension guarantee of ₹ 10,000 every month.
Employees retiring after 25 years of service will get 50% of their average salary of the last 12 months as pension.
If the employee dies,his family will get 60% of the last pension as a family pension.
Retirement Fund and How to Get a Pension
Under UPS,employees will get a lump sum amount on retirement,which will be 10% of their last basic salary and dearness allowance. If an employee takes voluntary retirement (VRS) after 25 years of service,he will get a pension only when his normal retirement age is completed.
For example,if someone takes VRS at the age of 55 and his retirement age is 60 years,he will get a pension only after the age of 60. This scheme will keep getting revised from time to time based on dearness allowance (DA) so that pensioners can get relief from rising inflation.
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