Unified Pension Scheme: The Union Cabinet chaired by Prime Minister Narendra Modi today (August 24) approved the Unified Pension Scheme (UPS) for government employees, which will provide an assured minimum pension and a family pension.
PM Modi said that the Unified Pension Scheme ensures dignity and financial security for government employees, aligning with the government's commitment to their well-being and secure future. His remarks came after the Union Cabinet approved an assured 50 per cent of salary as pension for 23 lakh government employees who joined service under the National Pension System (NPS).
PM Modi on Unified Pension Scheme
"We are proud of the hard work of all government employees who contribute significantly to national progress. The Unified Pension Scheme ensures dignity and financial security for government employees, aligning with our commitment to their well-being and a secure future," PM Modi posted on X.
23 lakh govt employees to benefit
Around 23 lakh Central government employees will benefit from the Unified Pension Scheme. These employees will now have the option to choose between the New Pension Scheme (NPS) and the Unified Pension Scheme.
The state governments will also be given the option to opt for the Unified Pension Scheme. If the state governments opt for UPS, the number of beneficiaries will be around 90 lakh. According to the government, the expenditure for arrears will be Rs 800 crore. The annual cost increase will be around Rs 6,250 crore in the first year.
The scheme will be effective from April 1, 2025. Central government employees will be given the option of choosing between NPS and UPS. The existing Central government NPS subscribers will also be given the option to switch to UPS.
UPS approved by Cabinet based on recommendations of committees
Union Minister Ashwini Vaishnaw said the Centre constituted a committee which held as many as 100 meetings with several top organisations, including the RBI and the World Bank, on the issue.
The UPS has been approved by the Cabinet based on the recommendations of this committee.
"Today, the Union Cabinet has approved the Unified Pension Scheme (UPS) for government employees providing for an assured pension. A 50 per cent assured pension is the first pillar of the scheme, while the second pillar will be an assured family pension,” the Minister explained.
On the spadework that went into the new scheme, the Minister said, “Government employees demanded some changes in the New Pension Scheme. For this, PM Modi constituted a committee under the chairmanship of Cabinet Secretary TV Somanathan. This committee held more than 100 meetings with different organisations and nearly all the states and the Unified Pension Scheme has been formulated based on these recommendations.”
“There's a difference between how PM Modi works and how the opposition functions. Unlike the opposition, PM Modi believes in holding extensive consultations,” Vaishnaw added.
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