The PFRDA stated that eligible central government employees can select the Unified Pension Scheme (UPS) until June 30, offering assured pension, family pension, minimum pension, inflation indexation, and lump sum payment at superannuation. This scheme is available for individuals who began employment on or after January 1, 2004 or are new entrants.
PFRDA’s notification outlines the scheme’s rules and eligibility criteria. Eligible employees can switch once from NPS to UPS. The deadline to make this switch is within three months of April 1, 2025. New employees starting on or after April 1 have a one-month window to decide. Once a choice is made, it is irrevocable.
The UPS now offers a higher government contribution at 18.5% compared to the previous 14%, with employee contributions remaining at 10% of basic pay plus DA. The pension corpus is divided into an individual and a separate pool fund, with the individual fund including both employee and government contributions, while the pool fund only consists of additional government contributions.
The UPS operates on a ‘fund-based’ model, requiring timely contributions from both employee and employer for payouts. Ensuring sufficient funds in individual and pool corpus allows for timely scheme payouts. Subscribers can choose their pension fund and investment pattern, with options including government securities or life cycle-based schemes with varying equity exposure limits.
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