Govt Allows One-Time One-Way Switch From Unified Pension Scheme To NPS — Check Details
This switch facility may be exercised by UPS optees any time not later than one year prior to the date of superannuation.
The government of India has introduced a one-time, one-way switch facility from Unified Pension Scheme (UPS) to National Pension System (NPS) for all central government employees, according to an office memorandum released by Pension Fund Regulatory and Development Authority on Monday.
According to the memorandum, "This switch facility may be exercised by UPS optees any time not later than one year prior to the date of superannuation or three months prior to the deemed date of retirement in case of voluntary retirement, as applicable."
As for those not eligible for this scheme it stated, "The switch facility will not be allowed in case of removal, dismissal or compulsory retirement as a penalty or for cases where disciplinary proceedings are ongoing or contemplated."
Once an employee makes the switch they will cease to be eligible for benefits under the UPS, and since they will come under the provisions of the PFRDA (Exit & Withdrawal under NPS) Regulations, 2015.
The memorandum added that "the government's differential contribution (4%) at default investment pattern will be worked out and shall be credited to the individual's NPS corpus at the time of exit."
Both the NPS and UPS offer retirement benefits, but they differ in structure, flexibility and pension payouts. While the NPS is a contributory scheme, the UPS offers a guaranteed fixed pension and a lump sum amount on retirement. This latter came into effect on April 1, 2025.
Under the UPS, a government employee with 25 years of service will get a monthly pension of 50% of the average basic salary of 12 months before retirement. The scheme guarantees a minimum pension of Rs 10,000 per month for employees with at least 10 years of completed service.
