BIG News For Pensioners! Unified Pension Scheme To Give You OPS-Like Gratuity Benefits; Check Details

The Unified Pension Scheme, an optional pension scheme for government employees, will now provide retirement and death gratuity benefits, said Union Minister of State for the Ministry of Personnel, Public Grievances and Pensions Jitendra Singh on Wednesday. The recent addition will enable UPS to provide benefits similar to those of the Old Pension Scheme (OPS).

The Unified Pension Scheme's upgradation with retirement and death gratuity benefits has addressed a significant demand of government staff and brought parity in retirement benefits, said Singh at the press conference on the completion of 11 years of the NDA government.

The inclusion of death-cum-retirement gratuity in UPS is likely to bring relief to lakhs of government employees who had been demanding the inclusion of this feature in the newly launched pension scheme. The move is also expected to encourage a larger number of government employees to opt for the UPS scheme over the National Pension System (NPS).

While announcing the decision, Singh mentioned that UPS is a reflection of "the government's commitment to ensure social security for all categories of employees under the National Pension System".

What is UPS?

The Unified Pension Scheme (UPS) was approved by the Union Cabinet in August 2024 and was notified on January 24, 2025. The UPS came into effect on from 1 April, 2025. The new pension scheme was launched in a bid to provide an alternative to pensioners who were demanding the rollback of OPS.

The new UPS provided 50% of the salary for those who joined the service after January 1, 2004. The retirement pension scheme is voluntary, and the government employees covered under the NPS can switch to UPS at their own will.

Under the UPS, the government will contribute around 18.5% in the retirement fund, and the employee will be required to contribute around 10% of their basic pay and DA. The UPS was rolled out with an aim of providing central government employees covered under NPS to opt for a guaranteed pension similar to OPS. However, the contribution model of UPS makes it different from OPS. The scheme provides a pension amount of 50 per cent of the average basic salary earned over 12 months before retirement. The scheme is available for those with at least 25 years of service.

UPS Payout And Calculation

The minimum assured payout under UPS for its beneficiaries is Rs 10,000 per month. The amount is granted to the beneficiary if the superannuation is after 10 years or more of qualifying service. The payout is also subject to timely and regular credit of contributions and now withdrawals.

As per the Unified Pension Scheme calculation, the full assured payout is at 50% of the 12-monthly average basic pay. It is applicable immediately before superannuation. The full assured payout is payable after a minimum of 25 years of qualifying service. The assured payout to pensioners begins as soon as they retire voluntarily after completing a minimum of 25 years of qualifying service.

UPS Eligibility for Government Employees

To become eligible for the scheme, it is important for government employees to complete a minimum of 10 years of qualifying service, retirement under the provisions of FR 56 (j), retirement after a minimum qualifying service period of 25 years.