New pension windfall for govt retirees: One-time bonus + monthly top-up under UPS; details here

The National Pension System (NPS) Trust has announced a new initiative for retirees, namely the Unified Pension Scheme (UPS). This scheme applies to former employees or their legally wedded spouses who retired on or before March 31, 2025. The application window for this scheme began on April 1, 2025, and closes on June 30, 2025. No claims will be accepted past this deadline, making it crucial for eligible individuals to act promptly.

The UPS, introduced by the Central Government, is designed to provide additional financial benefits to those who have served for at least 10 years in the Central Government.

Main highlights

One-time lump sum payment

The scheme includes a one-time lump sum payment equivalent to one-tenth of the last drawn basic pay and dearness allowance for every six months of qualifying service completed.

Monthly top-up

In addition to this lump sum, a monthly top-up is also offered. This top-up is calculated by factoring in the admissible UPS payout and dearness relief, minus the annuity amount under the existing NPS.

For spouses

Importantly, the scheme also caters to the spouses of retirees. “Legally wedded” spouses of such retirees are also eligible for the benefits. This extension ensures that the financial benefits can continue to support the family of the retiree.

PPF like benefits

Additionally, any arrears related to these benefits will accrue simple interest at rates aligned with the Public Provident Fund.

Application process

Eligible applicants can choose to apply for the UPS benefits through either physical or online submissions. For offline submissions, applicants must download the appropriate forms (Form B2 for subscribers and B4/B6 for spouses) from the NPS website and submit them to the Drawing and Disbursing Officer (DDO) of their last office.

Alternatively, the online submission process allows applicants to complete and submit their forms directly on the same website.

To assist retirees and their families in better understanding the UPS, the Pension Fund Regulatory and Development Authority (PFRDA) is conducting webinars. These sessions aim to clarify the scheme's benefits and application process. Further details about these webinars are available on the official PFRDA website.

The introduction of the UPS is a significant move to enhance the financial security of retirees who have served in the central government. It underscores the government's commitment to supporting former employees and their families by ensuring they receive benefits reflective of their service. Retirees and their families are encouraged to explore these benefits within the allotted application timeframe.

The UPS provides a substantial financial boost that complements existing NPS entitlements. As the deadline approaches, eligible retirees and their spouses should seize this opportunity to secure the additional financial support that the scheme offers.

Stakeholders are urged to look up the PFRDA website for comprehensive guidance and application materials before the June 30 cut-off date.