Gov’t Approves Unified Pension Scheme: Secure Benefits for All

On Saturday, the Union Cabinet, led by Prime Minister Narendra Modi, approved the new Unified Pension Scheme (UPS), designed to offer government employees a guaranteed pension, family pension, and a minimum pension.

Under this updated scheme, employees who retire after at least 25 years of service will receive a pension equal to 50% of their average basic pay from the last year of their service. For those with fewer than 25 years but at least 10 years of service, the pension will be adjusted proportionally based on their length of service.

Additionally, if a retired employee passes away, their family will receive a family pension amounting to 60% of the pension the employee was receiving before their death. The scheme also guarantees a minimum pension of Rs 10,000 per month for retirees who have completed at least 10 years of service.

During a media briefing on the cabinet's latest decisions, Union Minister for Information and Broadcasting Ashwini Vaishnaw explained that the new pension scheme would be adjusted for inflation.

In addition to the guaranteed pension, employees will receive a lump-sum payment upon retirement, alongside their gratuity. This payment will be calculated as one-tenth of the employee's monthly salary at the time of retirement for every six months of service completed. Importantly, this lump-sum payment will not affect the amount of the assured pension.

The government has also increased its contribution under the new scheme to 18.5%, while the employee's contribution will remain unchanged. Responding to a media query, Finance Secretary TV Somanathan, who is set to become the next Cabinet Secretary, stated that the new scheme is expected to offer greater benefits to employees compared to the existing one.

Among other decisions, the cabinet also gave the green light to the 'BioE3 (Biotechnology for Economy, Environment, and Employment) Policy for Advancing High-Performance Biomanufacturing.'

This policy, led by the Department of Biotechnology, aims to drive innovation by supporting research and development and nurturing entrepreneurship across various key sectors.

"This policy will speed up technology development and commercialization by setting up Biomanufacturing & Bio-AI hubs and Biofoundries. It also focuses on green growth through regenerative bioeconomy models, which will help expand India’s skilled workforce and significantly boost job creation," an official statement noted.

The policy is expected to bolster government initiatives like the 'Net Zero' carbon economy and the 'Lifestyle for Environment' programs.

Additionally, the cabinet approved the continuation of three existing schemes from the Department of Science and Technology, merging them into a single central sector scheme called 'Vigyan Dhara.' With a budget of Rs 10,579.84 crore, this new scheme will focus on building institutional and human capacity in science and technology, advancing research and development, and promoting technology development and deployment.

"The main goal of the 'Vigyan Dhara' scheme is to enhance science and technology capacity, as well as to drive research, innovation, and technology development, thereby strengthening the country's Science, Technology, and Innovation ecosystem. The scheme's implementation will boost the nation's S&T infrastructure by supporting well-equipped research and development laboratories in academic institutions," stated another announcement.

FAQs

Q. What is the new unified pension scheme?

A. The Unified Pension Scheme aims to balance fiscal policy with employee benefits and combines a defined benefit pension similar to the Old Pension Scheme with the contributory nature of the NPS.

Q. What is the minimum family pension in central government?

A. Minimum pension presently is Rs. 9000 per month. Maximum limit on pension is 50% of the highest pay in the Government of India (presently Rs. 1,25,000) per month. Pension is payable up to and including the date of death.

Q. What is the Unify pension scheme?

A. NEW DELHI: The Cabinet on Saturday approved the Unified Pension Scheme (UPS) for 23 lakh central government employees. The UPS ensures that all central government employees receive 50 per cent of their last drawn salary from the past 12 months as pension who have served for 25 years or more.

Q. What is gratuity in the unified pension scheme?

A. The lump sum amount to be received upon retirement will be calculated based on gratuity, which will be reduced by multiplying one-tenth of the last-drawn salary, including DA, by the number of completed six-monthly periods of service.

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