Finance Ministry Extends Unified Pension Scheme Deadline to September 2025

The Ministry of Finance has announced an extension of the deadline for opting into the Unified Pension Scheme (UPS) by three months, now pushing the cut-off to September 30, 2025. This decision follows numerous requests from stakeholders seeking additional time for eligible participants, including existing employees, past retirees, and legally wedded spouses of deceased retirees, to opt into the scheme.

Initially introduced on January 24, 2025, for eligible Central Government employees, the UPS aims to provide a more secure retirement option than the National Pension System (NPS). Notably, the scheme promises a fixed and assured pension, contrary to the NPS's variable pension amount. The Pension Fund Regulatory and Development Authority (PFRDA) further rolled out regulations to operationalize the scheme in March 2025.

Under the new terms, employees with at least 25 years of service are assured a pension equating to 50% of their basic salary from the last 12 months before retirement. Those with a minimum of 10 years of service qualify for a proportional pension, starting at a minimum of Rs 10,000 monthly. Additional benefits include assured family pensions, indexed to inflation, and calculated using historical formulas from the Old Pension Scheme (OPS). The UPS also stipulates 6% of the pensioner's compensation is allocated immediately to their family. The scheme, recommended by a committee under Finance Secretary T V Somanathan and ratified by the Union Cabinet in 2024, seeks to address public sector retirement security comprehensively.

(With inputs from agencies.)