Maharashtra Cabinet Approves Unified Pension Scheme, Effective April 2025

The Maharashtra Cabinet has approved the Unified Pension Scheme (UPS) following its sanction by the central government. Set to commence in April 2025, the UPS combines elements of the old and new pension schemes to provide a guaranteed pension amount and inflation-linked increments to eligible retirees.

In a significant move, the Maharashtra Cabinet has given its nod to the central government's Unified Pension Scheme (UPS), approved by the Modi administration on Saturday. The scheme is scheduled to take effect on April 1, 2025.

Opposition parties had been pressing for the return of the old pension scheme (OPS), which was replaced by the new pension scheme (NPS) in 2004. The NPS relied on defined contributions from both employees and employers, with funds invested in selected portfolios. The pension amount under this scheme was contingent on investment returns.

The government claims the Unified Pension Scheme merges the benefits of the old pension scheme with features of NPS. This scheme ensures a fixed pension amount, a guaranteed sum retirees will receive periodically post-retirement.

Under the UPS, central government employees with 25 years or more of service will receive 50% of their average last drawn salary over the previous 12 months as a pension. Additionally, these pensioners will benefit from inflation-linked increments to their pension amounts.

(With inputs from agencies.)