Record Enrollment in Unified Pension Scheme Amid Extended Deadline
Over 31,555 central government employees have enrolled in the Unified Pension Scheme (UPS) as of July 20, 2025, according to recent parliamentary disclosures. The government has extended the enrollment deadline to September 30, 2025, allowing employees additional time to transition from the National Pension System (NPS) to the UPS. Finance Minister Nirmala Sitharaman highlighted that the UPS provides assured payouts, offering a more predictable retirement income compared to the NPS. This shift aims to address concerns about market volatility in traditional pension schemes, ensuring employees receive stable financial support during retirement.
Eligibility and Benefits for Retired Subscribers
The UPS now extends its benefits to retired central government employees who retired under specific rules, including those who superannuated or passed away before March 31, 2025, with at least 10 years of qualifying service. These retirees are now eligible for additional perks such as retirement gratuity and death gratuity, which were previously unavailable under the NPS. Sitharaman emphasized that the scheme’s design ensures financial security for both active and retired employees, with tax benefits under the Income Tax Act, 1961, further enhancing its appeal.
Government’s Response to Pension Scheme Queries
Minister of State for Finance Pankaj Chaudhary confirmed that 31,555 employees have opted for the UPS, with over 4,978 claims processed for benefit payments as of July 20. The government has also clarified that the UPS will not be expanded to other pension schemes or sectors in the near future, as it remains a specialized option under the NPS. This decision underscores the government’s focus on maintaining the integrity of the existing pension framework while addressing the unique needs of central government employees.
Extended Benefits and Tax Advantages
The UPS now includes provisions for employees who die during service or are discharged due to invalidity, allowing their families to access benefits under the CCS (Extraordinary Pension) Rules, 2023. Tax benefits under the Income Tax Act, 1961, mirror those available to NPS subscribers, making the UPS an attractive option for those seeking financial stability. The government has also emphasized that retirees under Fundamental Rules 56(j) will receive additional support, ensuring comprehensive coverage for those who retired before the scheme’s launch.
Future of Pension Reforms and Sector-Specific Plans
While the UPS remains a centralized initiative, the government has no immediate plans to replicate its structure in other sectors. Sitharaman reiterated that the scheme was introduced as a voluntary option under the NPS for central government employees, with no broader expansion anticipated. However, the success of the UPS has sparked discussions about potential reforms to enhance pension security for all government employees, balancing the need for fiscal responsibility with employee welfare.
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