Central government employees will now get three more months to make up their mind about sticking to the National Pension System (NPS) or opting for the Unified Pension Scheme (UPS).
The deadline for finalising this choice has been extended by the Finance Ministry from 30 June to 30 September. This will give more time to eligible current employees, retirees and the legally-wedded spouses of retirees who have passed on.
This extension has been given after many stakeholders requested for the same.
The extension applies to eligible existing employees, past retirees and the legally- wedded spouses of deceased retirees.
The UPS is said to score better than NPS in terms of security. After all, the NPS offers market-linked returns and no guaranteed pension. On the other hand, UPS assures a monthly payout as well as a solid lump sum amount at retirement. With gratuity benefits being included recently, the scheme has become more attractive.
Newly-hired government employees have to opt for the UPS within 30 days of joining. Once the option has been made, the decision cannot be reversed. If the employees fail to decide by 30 September, they will, by default, have to continue with the NPS. Those who do opt to switch will have their current pension amount transferred to their Permanent Retirement Account Number (PRAN) under the UPS.
Three categories of employees can opt for UPS—Serving Central government employees as of 1 April 2025; those who retired on 31 March 025 (after serving for at least a decade or retired as per rules and not as penalty); the legally-wedded spouses of eligible retirees who have expired.
