PFRDA Announces Launch of Unified Pension Scheme Effective April 1
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Synopsis
The PFRDA has announced the official launch of the Unified Pension Scheme, effective from April 1, 2025, facilitating various categories of Central government employees to enroll under the new regulations.
Key Takeaways
- Unified Pension Scheme operational from April 1, 2025.
- Three categories of Central government employees eligible for enrolment.
- Government contribution increases to 18.5%.
- Option to switch from NPS to UPS available.
- Comprehensive benefits including assured pensions and lump sum payments.
New Delhi, March 20 (NationPress) The Pension Fund Regulatory and Development Authority (PFRDA) has officially announced the launch of the Unified Pension Scheme in accordance with the NPS Regulations 2025. This announcement follows the UPS notification from January 24, 2025, aimed at Central government employees within the NPS framework. The new regulations will take effect on April 1, 2025, as stated in an official release issued on Thursday.
These regulations facilitate the enrolment of three distinct categories of Central government employees. The first category encompasses existing employees who are in service as of April 1, 2025, and are covered under the NPS. The second category pertains to new recruits in Central government services who begin their roles on or after April 1, 2025. The third category includes employees who have retired or superannuated under Fundamental Rules 56(j)March 31, 2025, or their legally wedded spouses in cases where the subscriber passed away before opting for the UPS.
Enrolment and claim forms for all categories of Central government employees will be accessible online starting April 1, 2025, via the Protean CRA website: https://npscra.nsdl.co.in.
Employees also have the choice to submit physical forms, as mentioned in the official statement.
The PFRDA notification specified that eligible employees wishing to enroll in the UPS must do so within three months from April 1, 2025. New employees who join on or after this date will have a 30-day period to make their selection. The option once exercised shall be final and irrevocable, as stated in the notification.
An NPS subscriber who retires prior to March 31, 2025, is eligible to opt for the UPS. Additionally, the legally wedded spouse of a subscriber who has retired or passed away before making the UPS selection can also participate in the new scheme.
Under the UPS, the government’s contribution will increase to 18.5% from 14%, while the employee contribution will remain unchanged at 10% of basic pay plus DA (Dearness Allowance).
The pension corpus will be divided into two funds. The first will be an individual pension fund that will accumulate both the employee’s contribution and the government’s matching contribution, which will be invested based on the individual’s investment choices. The second fund will be a separate pool made up of the additional government contribution (8.5% of basic pay and DA) and will be invested independently.
The notification outlines rules for the scheme's operationalisation, which is designed to provide five key benefits: assured pension, assured family pension, assured minimum pension, inflation indexation, and lump sum payments upon superannuation along with gratuity, all within a single comprehensive package. This is available for government servants who have started their service on or after January 1, 2004, or who will be joining in the future, with an option for a one-time transition from the NPS to the UPS. Additionally, it will be optionally available to state governments for their employees.
