The Unified Pension Scheme (UPS), effective from April 1, 2025, provides central government employees under NPS with an assured pension option. As of December 2025, over 1.22 lakh employees opted in by the November 30 deadline, with first payments and arrears starting this month for eligible retirees.
What is the Unified Pension Scheme?
UPS blends NPS contributions with OPS-like guarantees. Employees contribute 10% of basic pay plus DA, while government adds 18.5%. It assures 50% of average last 12 months’ basic pay as pension after 25 years service, proportionate for shorter terms down to 10 years minimum.
Latest Updates in December 2025
The opt-in window closed November 30, 2025, after extensions. About 1.22 lakh out of 23 lakh eligible chose UPS. Eligible retirees now receive UPS pensions plus arrears from April 2025. A one-time switch back to NPS is allowed under conditions.
Key Benefits of UPS
UPS offers inflation-indexed dearness relief, ₹10,000 minimum monthly pension after 10 years, and 60% family pension. It includes lump-sum payment and gratuity, providing security without full market risk.
Eligibility Criteria
Central government NPS subscribers as of April 1, 2025, could opt in. New joiners post-April default to UPS in some cases. Past retirees with 10+ years service also qualified for arrears and top-ups.
| Feature | Unified Pension Scheme (UPS) | National Pension System (NPS) |
|---|---|---|
| Pension Type | Assured (50% of avg. last 12 months pay) | Market-linked (no guarantee) |
| Minimum Pension | ₹10,000/month (after 10 years) | None |
| Government Contribution | 18.5% | 14% |
| Family Pension | 60% of employee’s pension | Depends on annuity chosen |
| Inflation Protection | Yes (Dearness Relief) | Partial (via investments) |
| Opted Employees (Dec 2025) | ~1.22 lakh | Majority remain |
Why UPS Gains Traction
Unified Pension Scheme Latest Update December 2025 shows steady adoption for its balance of security and contributions. It addresses NPS uncertainty while maintaining fiscal discipline, with payments now flowing to beneficiaries.
Also read: OPS Update 2026: Why Government Employees Still Push for Guaranteed Pensions