Important update for UPS subscribers! Central government employees under Unified Pension Scheme eligible for OPS retirement, death gratuity benefits
Cheer for UPS subscribers: Central government employees opting for the
Unified Pension Scheme
or UPS will now be entitled to retirement and death gratuity benefits that were previously available under the Old Pension Scheme (OPS).
Union Minister of State for Personnel Jitendra Singh confirmed that central government staff under UPS will receive retirement and death gratuity benefits, according to the Central Civil Services (Payment of Gratuity under
National Pension System
) Rules, 2021.
The minister acknowledged this decision addresses a significant request from government workers, ensuring equality in retirement benefits across schemes.
The Department of Pension and Pensioners' Welfare (DoPPW), operating under the Personnel Ministry, issued a directive on Wednesday regarding options for OPS benefits in cases of service-related deaths or discharge due to invalidation or disability for central government servants under the Unified Pension Scheme.
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"The order gives an employee the option to revert to OPS in case of death in service. It is progressive in nature and addresses the clarifications being sought by employees," DoPPW Secretary V Srinivas told PTI.
UPS retirement and death gratuity benefits explained
The All India
NPS
Employees Federation's President, Manjeet Singh Patel, expressed enthusiasm about the order, describing it as a significant and necessary government initiative. According to Patel, incorporating death-cum-retirement gratuity into UPS will eliminate employees' uncertainties. He noted that including OPS benefits for employees who face death or disability during service under UPS represents fair treatment.
"Therefore, a lot of employees will opt for the UPS now," Patel said.
The Department of Pension and Pensioners' Welfare introduced the Central Civil Services (Implementation of National Pension System) Rules, 2021, addressing service matters for central government staff under NPS.
Rule 10 within these regulations provides central government employees under NPS (National Pension System) the choice between NPS benefits or the Old Pension Scheme if they face death during service or discharge due to invalidation or disablement.
"UPS has been notified as an option under the NPS. Therefore, it has been decided that the central government civil employees who opt for UPS under the NPS shall also be eligible for option for availing benefits under UPS or the CCS (Pension) Rules, 2021 or the CSS (Extraordinary Pension) Rules, 2023 in the event of death of the government servant during service or his discharge on the ground of invalidation or disablement," the order said.
The Ministry of Finance issued a notification on January 24, introducing UPS as an alternative under NPS for central government civil service recruits, effective from April 1, 2025. The notification provides central government employees under NPS a single opportunity to opt for UPS.
According to the order, central government employees choosing UPS under the National Pension System must submit Form 1 when joining service. This form allows them to select benefits either under UPS or CCS (Pension) Rules, 2021, or CCS (Extraordinary Pension) Rules, 2023, applicable in cases of death, disability discharge, or invalidity retirement.
"Existing government servants, who have opted for the Unified Pension Scheme under the National Pension System, shall also exercise such option as soon as possible after the notification of these clarifications," it said.
The order, distributed to all central government departments, stipulates that if a government servant dies whilst serving, their final option before death remains binding, without the family having the right to alter it.
Additionally, DoPPW released a separate order on Wednesday, confirming that central government staff under UPS qualify for retirement and death gratuity benefits as per the Central Civil Service (Payment of Gratuity under National Pension System) Rules, 2021.
DoPPW Secretary Srinivas explained that this directive "brings parity between the NPS and UPS pensioners and they will be eligible for Rs 25 lakh gratuity also".
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