Govt Extends Deadline For Unified Pension Scheme Option Till THIS Date; Check Here

The ministry’s decision comes in response to numerous representations from stakeholders seeking additional time to consider and exercise their option under the scheme

The Unified Pension Scheme was conceived following the recommendations of a high-level committee led by former Finance Secretary T.V. Somanathan in April 2023

Source : Tata AIA

The Ministry of Finance has extended the deadline to opt for the Unified Pension Scheme (UPS) by three months to provide more time and flexibility to Central Government employees and retirees. The new cut-off date is now September 30, 2025, extending the original deadline of June 30. This extension applies to eligible current employees, former government staff who have retired, as well as the legally wedded spouses of deceased retirees.

The ministry’s decision comes in response to numerous representations from stakeholders seeking additional time to consider and exercise their option under the scheme. The Unified Pension Scheme was first notified by the Ministry on January 24, 2025, offering a significant alternative to the National Pension System (NPS).

UPS Offers Assured Pension Benefits

Unlike the market-linked structure of the NPS, the UPS guarantees a fixed pension after retirement. Employees with 25 or more years of service are entitled to receive 50 per cent of the average basic pay drawn during the last 12 months of service. For those with a minimum of 10 years of service, pension benefits will be provided on a pro-rata basis, with a minimum assured pension of Rs 10,000 per month.

The scheme also offers an assured family pension, amounting to 60 per cent of the employee’s basic pay, in case of premature death. Additionally, inflation-linked indexation will be applied to the pension, family pension, and minimum pension, ensuring their value is preserved over time.

Gratuity, Family Support, And Regulatory Backing

Under UPS, employees are also entitled to gratuity benefits, calculated as one-tenth of the monthly emoluments for every six months of completed service. Moreover, 6 per cent of the pension will be immediately transferred to the family in the event of the pensioner’s death, reflecting a feature similar to that under the Old Pension Scheme (OPS).

To support implementation, the Pension Fund Regulatory and Development Authority (PFRDA) had issued relevant operational guidelines through the PFRDA (Operationalisation of the Unified Pension Scheme under NPS) Regulations, 2025 on March 19, 2025.

The Unified Pension Scheme was conceived following the recommendations of a high-level committee led by former Finance Secretary T.V. Somanathan in April 2023. The proposal received Cabinet approval in August 2024, marking a significant shift in pension policy, especially for those seeking assured post-retirement financial security.