The Union government announced on Saturday that it will start another pension scheme along with the National Pension System (NPS) of the 2004 vintage. The Unified Pension Scheme (UPS) – employees have a choice of moving to it or staying with NPS – is the result of many politics on pensions in the last few years. Many Opposition-led state governments had announced a reversion to the Old Pension Scheme (OPS) and promised its nationwide implementation if they came to power at the Centre.
The announcement itself is based on work done by a committee chaired by the finance secretary in the second Modi government, who is now the Cabinet secretary. In terms of what it offers the employees, UPS is as good as OPS. They’re entitled to a minimum assured pension amount and can look forward to drawing half of their salary at superannuation with the provision of a family pension. It would not be wrong to assume that the move will generate political tailwinds for the BJP not just among government employees and their families but also job-seekers who hope to land government jobs.