New Delhi:

Finance Minister on Tuesday joined the government’s pushback against the Congress’s “government of U-turns” jibe over the Unified Pension Scheme, or UPS, proposal. “We are not a government of U-turns… we give flexible, choice-driven governance,” she shot back.

The Finance Minister criticised the Congress for failing to understand the UPS is not a rollback to the pre-2004 pension plan, and that it will improve the current National Pension System, or NPS. She also hit out at non-BJP ruled states, saying, “I feel UPS will be implemented sooner or later…”

However, ministry sources told NDTV the government would not “market” the new pension scheme to states unwilling to adopt it; there is no compulsion to do so, sources explained.

Sources also said the ‘architecture’ of the new pension scheme has been given to all states, whether ruled by the BJP or an opposition party, and it is for each to weigh pros and cons and decide.

Ahead of the 2022 Himachal Pradesh election, for example, the Congress said it would implement the old scheme if it won power. The party secured a strong win, claiming 40 of its 68 seats.

Sources further said the new pension scheme is not applicable to public sector or employees of central or state-run banks, or the armed forces, who will continue with the older scheme.

In a major announcement ahead of elections in Jammu and Kashmir and Haryana in September-October, as well as those in Maharashtra and Jharkhand later this year, the government launched the Unified Pension Scheme – to be implemented from April 1 next year – on Saturday.

READ | “Will Benefit 23 Lakh Staff”: Centre Launches Unified Pension Scheme

“This will benefit 23 lakh central government employees…” Union Minister Ashwini Vaishnaw said, adding that employees would also have the option to choose between the old and new schemes.

The announcement triggered protests from the opposition.

Congress boss Mallikarjun Kharge fired the “government of U-turns” barb, pointing to instances when the Narendra Modi government had to rethink legislations amid fierce protests.

READ | “U In UPS Stands For…”: Mallikarjun Kharge Jabs Centre On Pensions

“Post June 4 (the date on which the April-June Lok Sabha election results were declared), the power of the people has prevailed over the arrogance of power of the Prime Minister…”

“Rollback in the budget regarding long-term capital gain/indexation, sending Waqf Bill to joint parliamentary committee, rollback of broadcast bill, rollback of lateral entry,” Mr Kharge said on X.

In response, BJP spokesperson Tuhin Sinha told NDTV that Congress-ruled states “end up making a mess of finances”. “Every morning, they come and spread lies. They have nothing to do. Unlike the Congress… which messes up finances in states they are in power, like Telangana and Karnataka… the central government takes care before taking key decisions,” he declared.

READ | After ‘ “U-Turn” Swipe, BJP’s Question On Old Pension Scheme

The Congress’ “U-turns” jibe also drew a strong response from senior BJP leader Ravi Shankar Prasad, who asked when the party planned on meeting its election promises. “I want to ask Rahul Gandhi – has his government implemented the old scheme as promised in Himachal Pradesh?”

The UPS retains several features of the pre-2004 pension scheme and, at its core, assures government staff of 50 per cent of their last-drawn basic pay as a lifelong monthly benefit. It also guarantees an assured minimum pension of Rs 10,000 per month on superannuation after a minimum of 10 years.

READ | Unified Pension Scheme Explained In 6 Simple Points

Under the new scheme – introduced by the Atal Bihari Vajpayee government in 2004 – pension payouts have been linked to contributions made by the government and the employee.

In the old scheme employees did not make any contributions.

When the old scheme was announced in 2004 five opposition-ruled states had rejected it.

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New Delhi:

The government has launched the Unified Pension Scheme (UPS), aimed at benefiting 23 lakh central government employees. Union Information and Broadcasting Minister Ashwini Vaishnaw announced the launch, stating that the new scheme will be implemented from April 1, 2025. “Some central employees met with the Prime Minister today. They were with the UPS in the meeting,” he added.

Unified Pension Scheme: Eligibility

• According to Ashwini Vaishnaw, employees who have completed a minimum of 10 years of service are eligible to receive a pension under the UPS. However, the full benefits of the scheme, including the assured pension, apply to those with at least 25 years of service.
• The scheme is optional for existing employees under the National Pension System (NPS) and those opting for Voluntary Retirement Scheme (VRS) under NPS. Future employees will also have the option to join the UPS. However, once an employee opts into the UPS, the decision is final and cannot be reversed.

UPS: Minimum Pension Amount

Mr Vaishnaw revealed that the UPS guarantees a minimum pension of Rs 10,000 per month for employees who retire after completing at least 10 years of service.

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Key Benefits of the Unified Pension Scheme

• Retirees will receive 50% of their average basic pay over the last 12 months before retirement as a pension. This benefit is available to employees with at least 25 years of service, with proportionate benefits for those with shorter service periods (down to a minimum of 10 years), revealed the Information and Broadcasting Minister.
• The government will increase its contribution to the pension fund from 14% to 18.5%. This increase does not affect the employee’s contribution, which remains unchanged.
• Mr Vaishanw stated that in case of a pensioner’s death, their family will receive 60% of the pension the retiree was receiving.
• Pensions under the UPS will be indexed to inflation. The Dearness Relief (DR) will be based on the All India Consumer Price Index for Industrial Workers (AICPI-IW), providing protection against rising living costs.
• At the time of superannuation, retirees will receive a lump-sum payment in addition to their gratuity, revealed Ashwini Vaishnaw. This payment will be equivalent to one-tenth of the monthly emoluments (pay + DA) as of the date of superannuation for every six months of completed service. Importantly, this payment will not reduce the amount of assured pension.
• The scheme will also apply to past retirees under the NPS who have already superannuated. These retirees will receive arrears for the past period, with interest calculated at Public Provident Fund (PPF) rates.

Other Details

• The UPS will be implemented by the Central Government, directly benefiting approximately 23 lakh Central Government employees.
• It will be implemented from April 1, 2025.
• The scheme’s architecture is designed for adoption by State Governments as well. If fully adopted, the UPS could benefit over 90 lakh government employees currently under the NPS across India.

ALSO READ | Unified Pension Scheme Explained In 6 Simple Points 

ALSO READ | “Will Benefit 23 Lakh Employees”: Centre Launches Unified Pension Scheme