UPS government approves pension plan for central employees
Since then, the Modi cabinet has implemented the new UPS pension scheme across the country. The demand for OPS has vanished. If you are also confused about the three pension schemes, understand them here in simple language. See, according to UPS, the Central Government will provide pension to government employees. For government employees, after 25 years of service, after retirement, they will be given 50 per cent of their basic pay of the last 12 months as pension. The special thing about this scheme is that it has an assured pension provision. If a person works for 10 years, he will get a pension of at least Rs 10,000.
This will be the specialty
There is also a provision for family pension, under which if an employee dies after retirement, his family members will get 60 per cent of his pension. A lump sum will be given on retirement from UPS. It will be computed as one-tenth of the basic pay and dearness allowance for every six months of service of the employee. There is also a provision for increasing pension after retirement in UPS, which is index-linked. UPS is only for government employees, over 23 lakh central government employees will benefit from it.
Private sector individuals will not be able to take advantage of UPS benefits
UPS is only for government employees whereas NPS is for both government and private sector employees. OPS was for government sector employees. In UPS, 50 percent of the average basic salary of last 12 months will be given as pension after retirement whereas in NPS there was no guaranteed pension provision after retirement whereas in OPS, 50 percent of the last basic salary will be given as pension.
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NPS is not safe?
UPS and OPS are safe schemes, while NPS is linked to the stock market. Like NPS, in UPS 10 per cent of the salary i.e. basic plus DA will be deducted. Though the government contribution will be 18.5 per cent, up from 14 per cent earlier, there will be no cut in OPS. There is a provision of a lump sum on retirement in UPS, which will be calculated as one-tenth of the basic pay and dearness allowance for every 6 months of service of the employee.
NPS is winning here
Of the total amount deposited in NPS, 60 per cent could be withdrawn as a lump sum on retirement and 40 per cent could be kept for NUT. In UPS and OPS, no investment is required to be made to receive pension, while in NPS, 40 per cent of the fund needs to be invested. There is an index benefit in UPS and OPS, while this was not the case in NPS. There is a pension provision of Rs 10,000 per month after working for 10 years in UPS. There is no such provision in NPS, while there is a provision for commutation of pensions in OPS.
