There is good news for all central government employees. Under the newly introduced Unified Pension Scheme (UPS), all employees will now be entitled to retirement and death gratuity benefits—similar to those provided under the Old Pension Scheme (OPS). Union Minister Jitendra Singh announced this update on Wednesday, highlighting that this move will ensure better social security and help employees feel financially secure after retirement.
The Ministry of Personnel, Public Grievances and Pensions has implemented several reforms over the past 11 years to simplify governance and empower citizens.
What is the Unified Pension Scheme (UPS)?
The UPS, effective from 1 April 2025, is a new pension system introduced by the Central Government. Its objective is to provide a guaranteed and assured pension to government employees. This scheme is based on the National Pension System (NPS) framework but combines some of the benefits of both NPS and OPS.
Fulfilling a Long-standing Demand
Minister Jitendra Singh said that the government is fulfilling a major demand of employees, which will bring uniformity in retirement benefits. He also stated that the new rules reflect the government’s commitment to ensuring social security for all employees under NPS.
The announcement was made during a press conference where Singh reviewed the performance of the ministry over the last 11 years. He emphasized the reforms made to improve governance and empower citizens.
Retirement and Death Gratuity Now Available Under UPS
Employees covered under UPS will now be eligible for retirement and death gratuity as per the Central Civil Services (Payment of Gratuity under NPS) Rules, 2021. This means they will now receive gratuity benefits similar to those provided under OPS.
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Official Order Issued
The Department of Pension and Pensioners’ Welfare (DoPPW) has issued an official order stating that employees under UPS will have the option to receive OPS benefits in case of death, disability, or incapacity during service.
DoPPW Secretary V. Srinivas said, “This order gives employees the option to be covered under OPS benefits if they die during service. It is progressive in nature and addresses key concerns raised by employees.”
This means that in the event of an employee’s death during service, the family will be entitled to benefits under OPS.
Employees’ Federation Welcomes the Move
Manjeet Singh Patel, President of the All India NPS Employees Federation, welcomed the government’s decision, calling it historic and much-needed.
He added that including death-cum-retirement gratuity under UPS will remove all confusion and encourage more employees to opt for UPS.
Background and Additional Clarifications
Earlier, the DoPPW had implemented the Central Civil Services (Implementation of NPS) Rules, 2021, to govern service-related matters of central employees under NPS. Rule 10 of this framework allows employees to opt for either NPS or OPS benefits in the event of death, disability, or retirement on medical grounds.
The Ministry of Finance had also issued a notification on 24 January, confirming that employees appointed to Central Government civil services from 1 April 2025 onwards would have the option to choose UPS instead of NPS.
The latest order from DoPPW makes it clear that employees under UPS will be entitled to gratuity benefits under the 2021 rules, bringing parity between NPS and UPS pensioners.
V. Srinivas also stated that this move ensures uniformity in benefits and that both NPS and UPS beneficiaries will now be eligible for gratuity up to ₹25 lakh.
In short, this development is a major step toward ensuring retirement equality and financial security for central government employees under the newly launched Unified Pension Scheme.