Key Takeaways
- UPS was recommended by the T.V. Somanathan committee, announced in August 2024, notified on January 24, 2025, and became effective from April 1, 2025.
- It functions as an option under the existing National Pension System (NPS) rather than a replacement, so eligible employees can choose to stay on NPS or switch to UPS.
- The assured pension equals 50 percent of the average basic pay drawn in the last 12 months before superannuation for employees completing at least 25 years of qualifying service, with a proportional pension for shorter service down to a 10-year minimum.
- A guaranteed minimum pension of ₹10,000 per month applies for anyone with at least 10 years of qualifying service, and a family pension equal to 60 percent of the assured pension applies on the employee's death.
- The Finance Ministry confirmed in Parliament on August 3, 2026, that there is no proposal to amend or replace UPS and that gratuity and tax benefits have been extended to UPS subscribers on par with NPS.
Why UPS was introduced
The Unified Pension Scheme grew out of the T.V. Somanathan committee's 2023 review of the National Pension System, formed to address concerns that NPS, being fully market-linked, did not offer enough predictability for retiring government employees. The government announced UPS in August 2024, formally notified it on January 24, 2025, and it became operational from April 1, 2025, with the option window for existing employees to switch initially running through September 30, 2025, later extended through November 30, 2025.
Rather than replacing NPS outright, UPS was structured as a choice: Central Government employees already covered under NPS can either remain on NPS with its market-linked returns or opt into UPS for an assured, inflation-indexed pension.
Who can opt into UPS?
- Newly recruited Central Government employees joining service after April 1, 2025, who are covered under NPS
- Existing NPS-covered employees who choose to migrate to UPS within the notified option window
- Past retirees, including those who retired through superannuation, voluntary retirement, or retirement under FR 56(j), on or before March 31, 2025, provided they completed at least 10 years of regular service
- Surviving spouses of eligible deceased retirees, who can exercise the option on the retiree's behalf
How the assured pension is calculated
| Condition | Pension outcome |
|---|---|
| 25 years or more of qualifying service | 50% of average basic pay drawn in the last 12 months before superannuation |
| Between 10 and 25 years of qualifying service | Proportional pension based on years served |
| At least 10 years of qualifying service, any calculation outcome | Minimum guaranteed pension of ₹10,000 per month |
| Employee's death while in receipt of pension | Family pension equal to 60% of the assured pension |
How to apply or migrate to UPS
Applications and migrations are processed through the Protean CRA (Central Recordkeeping Agency) website, using specific forms depending on the applicant's situation.
- Form A1: for newly recruited employees joining service after April 1, 2025
- Form A2: for existing NPS members who want to exercise the option to migrate to UPS
- Form B1: for NPS subscribers who retired on or after April 1, 2025
- Form B2: for those who retired on or before March 31, 2025
- Form B5: for the surviving spouse of a deceased retiree exercising the option on the retiree's behalf
Frequently Asked Questions
What is the Unified Pension Scheme?
The Unified Pension Scheme (UPS) is an optional pension scheme for Central Government employees covered under the National Pension System (NPS). It was notified on January 24, 2025, and became effective from April 1, 2025, offering an assured, inflation-indexed pension as an alternative to the market-linked NPS.
How is the UPS pension amount calculated?
The assured pension is calculated as 50 percent of the average basic pay drawn during the last 12 months before superannuation, for employees who complete at least 25 years of qualifying service. A proportional pension applies to those with shorter service, subject to a minimum of 10 years.
Is there a minimum guaranteed pension under UPS?
Yes. A minimum pension of ₹10,000 per month is guaranteed for employees with at least 10 years of qualifying service, regardless of how the standard 50 percent calculation works out.
Who is eligible to opt for UPS besides serving employees?
Past retirees who superannuated or retired, including through voluntary retirement or retirement under FR 56(j), on or before March 31, 2025, are eligible, provided they completed a minimum of 10 years of regular service. Surviving spouses of eligible deceased retirees can also opt in on their behalf.
Does UPS also provide a family pension?
Yes. In the event of the employee's death, the family is entitled to a pension amounting to 60 percent of the assured pension the employee was entitled to before their demise.
How many employees have opted for UPS so far?
According to a Ministry of Finance update given in the Lok Sabha on August 3, 2026, a total of 1,18,195 subscribers, including new joinees, existing employees who migrated from NPS and eligible past retirees, had opted for UPS as of July 19, 2026.
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