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The government on Monday told Parliament that there is no proposal pending with the Government of India to restore the Old Pension Scheme (OPS) for central government employees covered under the National Pension System (NPS).
Finance Minister Nirmala Sitharaman, while responding to a question in the Lok Sabha, said that the government has distanced itself from OPS due to its unsustainable fiscal liability on the exchequer. Let us tell you that NPS is a fixed contribution-based scheme which was launched for central government employees (except armed forces) joining service on or after January 1, 2004.
UPS option for employees covered under NPS
The Finance Minister said that with a view to improving the pensionary benefits of such employees, a Committee was constituted under the Chairmanship of the then Finance Secretary to suggest measures for amendments in the NPS. Based on the Committee’s deliberations with stakeholders, Unified Pension Scheme (UPS) has been introduced as an option under NPS with a view to providing assured post-retirement benefits to Central Government employees covered under NPS, she said.
The government introduced UPS as an option in January
Nirmala Sitharaman said that the features of UPS, including the definition of family, have been designed in such a way that fixed payments are ensured and at the same time financial stability of the fund is maintained. Further, she said that Government servants opting for UPS under NPS will also be eligible for the option to receive benefits under CCS (Pension) Rules, 2021 or CCS (Extraordinary Pension) Rules, 2023, in the event of death of the Government servant during service or his retirement on the ground of invalidity or disability. She said that UPS has been introduced as an option under NPS by the Government through a notification dated January 24, 2025.
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