UPS's announcement comes amid discussions on the possible timing of the 8th Pay Commission, which has brought the government's focus on addressing the concerns of employees and pensioners.

8th Pay Commission Update: In good news for central government employees, the Unified Pension Scheme (UPS) was introduced last week as a balanced approach between the old Pension Scheme (OPS) and the National Pension System (NPS). The announcement received a positive response from the National Federation of Indian Railwaymen (NFIR). Notably, the announcement comes amid discussions on the possible timing of the 8th Pay Commission, further underscoring the government's focus on addressing the concerns of employees and pensioners.

Expectations regarding 8th Pay Commission

Furthermore, the NFIR has requested that the Central Government take steps to set up a new, 8th Pay Commission. Their main goal with their commissions is to help them determine the right salary adjustments for their employees. Hence, the 8th Pay Commission is expected to be announced soon.

More than 23 lakh government employees to get UPS under NPS

The recently announced Unified Pension Scheme for Central Government Employees will be available only to retirees who are members of the New Pension Scheme (NPS).

The new scheme guarantees employees a market return linked payout under the NPS for a minimum qualifying service of 25 years as superannuation of 50 per cent of their average basic pay in the 12 months preceding retirement.

As per the scheme approved by the Union Cabinet, the pension will be uniform for a minimum service period of up to 10 years. Also, guaranteed pension of Rs 10,000 per month on retirement after minimum 10 years of service.

This scheme has been introduced to address the concerns of government employees regarding NPS which came into effect from 1st January 2004. Under the old pension scheme (OPS) implemented before January 2004, employees received 50 percent of their last drawn basic. Pay as pension.

Unlike the old pension scheme, UPS is contributory in nature, requiring employees to contribute 10 per cent of their basic salary and dearness allowance while the employer's (central government) contribution is 18.5 per cent.

Under NPS, the employer's contribution is 14 percent and the employee's contribution is 10 percent. However, the final payout depends on market returns on that corpus, mostly invested in government debt.

(with input from agencies)