Rajya Sabha Discusses Unified Pension Scheme (UPS) for Central Government Employees

In a Rajya Sabha session held on March 11, 2025, Shri Javed Ali Khan raised an unstarred question (No. 1382) regarding the recently introduced Unified Pension Scheme (UPS) under the National Pension System (NPS). The Minister of State for Finance, Shri Pankaj Chaudhary, provided key clarifications on assured payouts, voluntary retirement, and gratuity benefits under the new scheme.

Key Questions and Government’s Response

1. Assured Payouts for Employees Opting for Voluntary Retirement

Shri Javed Ali Khan inquired whether, as per the Gazette Notification dated January 24, 2025, employees taking voluntary retirement after completing 25 years of qualifying service would receive assured payouts from the date of their notional superannuation.

Response:
The Minister confirmed that under UPS, assured payouts will commence from the date the employee would have superannuated, had they continued in service. This decision considers the fund accumulation period and aims to maintain the sustainability of pension funds.

2. Rationale Behind Delayed Pension Payouts

The rationale for this structure, as explained by the Minister, is based on the growth of pension funds over an employee’s actual length of service. This ensures that employees receive structured payouts while maintaining the financial health of the pension system.

3. Gratuity Benefits Under UPS

Another key query was whether gratuity would be applicable under UPS, similar to the Old Pension Scheme (OPS) and NPS.

Response:
The Minister confirmed that gratuity is payable under UPS in accordance with the Central Civil Services (Payment of Gratuity under NPS) Rules, 2021, which are already in force for employees covered under NPS.

Conclusion

The government’s response in the Rajya Sabha clarifies that UPS is a fund-based pension scheme operating under NPS principles, ensuring both assured payouts and gratuity benefits for eligible employees. Employees who opt for voluntary retirement must account for the fact that their pension payouts will begin at their original superannuation age.

View original question in pdf: