New Delhi: Union Cabinet approves assured 50 per cent of salary as pension for govt employees under Unified Pension Scheme. The Narendra Modi-led central government has decided to replace the New Pension Scheme (NPS) with this new plan. The scheme will come into effect on April 1, 2025.

The decision was confirmed in a recent Union Cabinet meeting. According to Minister Ashwini Vaishnaw, the Unified Pension Scheme (UPS) will ensure a pension of 50 per cent of the average monthly basic salary over the past 12 months, aiming to provide better financial security for government employees.

Under this scheme, a dearness allowance will be attached to the pension to help offset the impact of inflation. Further, employees will receive a lump sum payment at the time of retirement. This payment will be an accumulated amount earned during their service which will be a fixed portion of their monthly salary and will increase with every six months of service.

If an employee has worked for at least 25 years, they will receive a pension of at least 50 percent of their average salary from the last 12 months before retirement. In case of the pensioner’s death, their family will receive 60 per cent of the pension amount. Further, if someone leaves their job after 10 years, they will receive a pension of Rs 10,000.

23 Million Employees To Benefit

Approximately 2.3 million central government employees will benefit from this new Unified Pension Scheme. Employees will have the option to choose between the NPS and the UPS. The Unified Pension Scheme will also include benefits linked to inflation indexing.





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