This reform will significantly enhance the sense of security among government employees, offering them assured pensions, family pensions, and minimum pensions. State governments will also have the option to adopt the Unified Pension Scheme.
Union Minister Ashwini Vaishnaw stated that the Centre had constituted a committee that held 100 meetings with several top organisations, including the RBI and the World Bank, to finalise the details of the scheme.
Here are the key features of the UPS in a nutshell:
Assured Pension: Under this scheme, retirees will receive a pension amounting to 50 per cent of the average basic pay drawn over the last 12 months prior to retirement, for a minimum qualifying service of 25 years. The pension will be proportionate for those with shorter service periods, with a minimum requirement of 10 years of service.
Assured Family Pension: In the event of an employee’s death, their family will be eligible to receive 60 per cent of the pension amount that the employee was receiving immediately before their death. This ensures financial security for the employee’s dependents.
Assured Minimum Pension: The new scheme guarantees a minimum pension of Rs 10,000 per month after a minimum of 10 years of service, providing a safety net for employees with lower salaries.
Also Read: Centre approves Unified Pension Scheme, all you need to know
Other Benefits of Unified Pension Scheme:
Inflation Indexation: The assured pension, family pension, and minimum pension will be indexed to inflation.
Dearness Relief: This will be based on the All India Consumer Price Index for Industrial Workers (AICPI-IW), similar to the provisions for serving employees.
Lump Sum Payment: In addition to gratuity, employees will receive a lump sum payment at retirement equivalent to 1/10th of their monthly emoluments (pay + DA) as of the retirement date for every completed six months of service. This payment will not affect the amount of the assured pension.
