Government Approves New Unified Pension Scheme for Central Employees

The Union Cabinet has approved a new Unified Pension Scheme, promising 50% of salary as pension for central government employees who joined after January 1, 2004. This scheme includes provisions for family pensions, gratuity, and inflation indexation. It will benefit 23 lakh employees and may extend to 90 lakh if state governments participate.

In a significant move, the Union Cabinet has sanctioned the Unified Pension Scheme (UPS) for central government employees, offering an assured pension of 50% of the average basic pay drawn in the last 12 months before superannuation. This decision affects employees who joined after January 1, 2004.

The scheme addresses long-standing demands from government employees and comes ahead of critical assembly elections in Haryana and Jammu and Kashmir. The initiative, approved during a meeting chaired by Prime Minister Narendra Modi, ensures a minimum qualifying service of 25 years, with the pension being proportionate for lesser service periods down to a minimum of 10 years.

Information and Broadcasting Minister Ashwini Vaishnaw announced further features of the scheme, including an assured family pension for spouses of deceased employees, inflation indexing, and Dearness Relief. The UPS replaces the National Pension System's contribution-based model and could benefit up to 90 lakh employees if state governments opt-in.

(With inputs from agencies.)