UPS Explainer: What is Unified Pension Scheme, what are its features; how different is it from OPS and NPS?
Taking a big decision on pension, the Union Cabinet has approved the Unified Pension Scheme (UPS) for government employees. Under this, after retirement, an assured pension equal to half the salary will be available. This scheme will come into effect from April 1, 2025, and about 23 lakh government employees will benefit from it.
Here we will learn about UPS in detail, as well as try to know and understand how different it is from OPS i.e. Old Pension Scheme, and NPS i.e. New Pension Scheme.
UPS: What is the Unified Pension Scheme?
Unified Pension Scheme (UPS) is a new pension scheme for government employees, under which provision of assured pension has been made. In this, an assured amount has also been fixed for family pension and provision of indexation on inflation has also been made.
The biggest feature of UPS is that like the Old Pension Scheme, it ensures half the salary as pension. This was a big demand of central employees amid dissatisfaction over NPS i.e. New Pension Scheme.
5 Features of UPS
Talking about this, Union Minister Ashwini Vaishnav has told 5 features.
Assured Pension: This will be 50% of the average basic salary of the last 12 months before the retirement of an employee. Those who have served for at least 25 years will get this amount. At the same time, it will decrease proportionately if the service period is less.
Assured Minimum Pension: In case of retirement after 10 years of service, a provision of assured minimum pension of Rs 10,000 per month has been made.
Assured Family Pension: After the death of the pensioner, his dependent will be given 60% of the pension of the government employee as a family pension.
Inflation Indexation: Dearness Relief will be available on all three types of pensions. It will be calculated based on the Consumer Price Index for industrial labor. As is the case with DA for service-holder government employees.
Lump-Sum Payment on Retirement: Apart from gratuity, employees will get a lump sum amount on retirement. It will be calculated as the 10th part of the monthly remuneration (salary + dearness allowance) at the time of retirement for every 6 months of service.
