Unified Pension Scheme for Central staff; 50% of basic pay as pension

The Union Cabinet has approved the Unified Pension Scheme (UPS), which aims to provide assured pension, family pension, and a minimum pension to government employees.

Under the new scheme, employees would get an assured pension of 50 percent of the average basic pay drawn over the last 12 months before superannuation for a minimum qualifying service of 25 years. And if the employee has served between 25 years and 10 years, then the pension would be proportionately derived.

Family pension 60 percent

When a retired employee dies, their family would get a family pension of 60 percent of the pension received by the employee. There will be a minimum pension of ₹10,000 per month on superannuation after 10 years of service.

Union Minister for Information and Broadcasting Ashwini Vaishnaw said the pension would be based on inflation indexation.

An employee would get a lump-sum payment at superannuation in addition to the gratuity. It would be one-tenth of the monthly emoluments as of the date of superannuation for every completed six months of service. This payment will not reduce the quantum of assured pension. 

Further, the government has increased its share of contribution under the new scheme to 18.5 percent, while the employee contribution would remain the same. Union Finance Secretary TV Somanathan, who has been tipped to be the next Cabinet Secretary, said that the new scheme was more beneficial for employees than the current scheme.

                                                     (By arrangement with livemint.com)