• Source:JND
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Unified Pension Scheme: The Union Cabinet on Saturday approved the Unified Pension Scheme - a new social security initiative for government employees, which is set to benefit over 23 lakh central government employees. The new scheme promises an assured family pension and minimum pension for government employees.

Taking to social media X, Prime Minister Narendra Modi hailed the contribution of government employees in the nation's progress and said that 'Unified Pension Scheme ensures dignity and financial security for government employees'.

Understanding key aspects of Unified Pension Scheme --

1. Assured Pension: Government employees, who have served a minimum of 25 years in the service, will be eligible for an assured pension which will be calculated as 50 per cent of the average basic pay drawn over the last 12 months before superannuation.

2. Assured Family Pension: The new scheme not only provides social security to the employee him/herself but to the family as well. In case of untimely demise of the employee, their spouse will get 60 per cent of the salary drawn at the time of death, as a family pension.

3. Assured Minimum Pension: For employees with at least 10 years of service, UPS promises an assured minimum pension of Rs 10,000. "Assured Minimum Pension @10000 per month on superannuation after minimum 10 years of service," a cabinet statement stated.

4. Inflation Adjustment: All three pensions - assured pension, assured family pension and assured minimum pension - will be adjusted as per the rates of inflation. A Dearness relief will be applicable based on the All India Consumer Price Index for Industrial Workers (AICPI-W) as in the case of serving employees, the statement stated.

5. Lump-Sum Payment At Retirement: In addition to gratuity, a provision stipulates a lump-sum payment to the employee at the time of retirement. The 10 per cent of monthly salary (pay + DA) as of the date of superannuation for every completed six months of service will constitute the lump-sum payment. This payment will not reduce the amount of assured pension.

UPS Scheme Frequently Asked Questions: 

1. Will it replace the National Pension Scheme?

Answer: The Unified Pension Scheme is unlikely to replace the National Pension Scheme as government employees will be given an option to choose between the two, Union Minister Ashwini Vaishnaw said.

2. When will UPS be enacted?

Answer: The newly launched social security scheme is set to be enacted in the next financial year, which will begin in April 2025.

3. What are the minimum service period criteria in UPS?

Answer: To get an assured pension of 50 per cent of the last drawn salary as pension, the employees will need to complete at least 25 years of service in the public sector.