New Delhi: In a landmark decision aimed at ensuring a secure post-retirement future for government employees, the Union Cabinet, chaired by Prime Minister Narendra Modi, has given the green light to the Unified Pension Scheme (UPS). This new scheme brings comprehensive pension benefits with a focus on long-term financial security for employees and their families.
Key Features of the Unified Pension Scheme (UPS):
- Assured Pension: Government employees with a minimum qualifying service of 25 years will receive a pension amounting to 50% of their average basic pay drawn over the last 12 months before superannuation. For employees with service periods shorter than 25 years but at least 10 years, the pension will be proportionate to their years of service.
- Assured Family Pension: In the unfortunate event of the pensioner’s demise, the family will receive 60% of the employee’s pension, providing continuous financial support to the family.
- Minimum Pension: The UPS guarantees a minimum monthly pension of ₹10,000 after 10 years of service, ensuring a baseline financial safety net for retirees.
- Inflation Protection: The pension scheme offers inflation indexation, ensuring that pensions, family pensions, and minimum pensions are adjusted in line with inflation. The indexation will be based on the All India Consumer Price Index for Industrial Workers (AICPI-IW), ensuring that retirees’ purchasing power is maintained.
- Dearness Relief: Pensioners will receive additional Dearness Relief, similar to that provided to current service employees, to safeguard against rising living costs.
- Lump-Sum Payment at Superannuation: In addition to the standard gratuity, the scheme also includes a lump-sum payment at superannuation. This will be calculated as 1/10th of the monthly emoluments (basic pay + Dearness Allowance) for every six months of completed service. This extra payment will not affect the quantum of the assured pension.
The UPS is designed to provide a robust retirement framework, ensuring that government employees and their families are financially secure after retirement. The scheme combines both pension benefits and gratuity, with inflation protection and family support, addressing concerns about rising costs and uncertainties during retirement.
A Major Step Towards Social Security
The approval of the Unified Pension Scheme reflects the government’s commitment to improving social security for its employees. By providing both assured and family pensions along with inflation-indexed payouts, the scheme offers a significant upgrade to the existing retirement benefits, helping employees plan for a comfortable and secure future.
This new pension framework is expected to benefit millions of government employees across the country, ensuring they receive adequate support after years of service.