Government Clarifies Pension Payment Rules for NPS Subscribers

The Central Pension Accounting Office (CPAO), under the Ministry of Finance, has reiterated the guidelines for processing pension and family pension payments for National Pension System (NPS) subscribers. The office memorandum (OM) issued on March 12, 2025, instructs Pay and Accounts Offices (PAOs) and Central Pension Processing Centres (CPPCs) of authorized banks to adhere strictly to the procedures applicable to Old Pension Scheme (OPS) cases.

This development follows an earlier notification dated December 18, 2023, which directed that all NPS pension and family pension cases should be processed under the same framework as OPS cases.

Key Highlights from the Office Memorandum

1. Uniform Processing of Pension Cases
   • As per the March 30, 2021, notification by the Department of Pension & Pensioners’ Welfare, all pension and family pension cases under NPS are to be handled similarly to OPS cases.
   • Rule 20 of the Central Civil Service (Implementation of National Pension System) Rules, 2021, provides for pension and family pension benefits in case of invalidation or death of the subscriber.
   • The Controller General of Accounts (CGA) issued an OM on December 7, 2023, discontinuing the allotment of N-series PPO numbers in the PFMS pension module.
2. Issues Observed in Submission of NPS Pension Cases
   • Several PAOs have not followed the prescribed guidelines while submitting pension cases to CPAO.
   • It was observed that PAOs were submitting three copies of the Provisional PPOs, whereas only two copies of PPO Booklets (Pensioner Portion & Disburser Portion) should be sent.
3. Clarification on PPO Number and Pension Processing
   • CPAO has confirmed that PPO number allotment and pension processing for NPS cases will now follow OPS norms.
   • CPPCs of authorized banks have been designated as the pension disbursing authorities.
4. Directives to PAOs and CPPCs
   • Principal CCAs, CCAs, CAs, and AGs have been instructed to ensure compliance with submission guidelines by PAOs under their jurisdiction.
   • CPPCs of authorized banks must ensure correct issuance of PPO Booklets and return any Provisional PPO Booklets mistakenly issued.

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Impact on Pensioners and Government Offices

This clarification simplifies the pension disbursement process for NPS retirees, aligning it with OPS procedures. It is expected to streamline administrative workflows and minimize delays in pension processing. Additionally, the move enhances uniformity and reduces confusion among PAOs and pension disbursing banks.

With this directive, CPAO aims to ensure a smooth transition for NPS retirees by addressing discrepancies and reinforcing existing regulations.

For further updates, stakeholders are advised to follow the CPAO’s official communications and guidelines.

See original CPAO OM: