Maharashtra government offers employees a choice of NPS, UPS, revised pension scheme

Chief Minister Eknath Shinde in a meeting with employees' unions has said the state government employees and officers can choose an option from the Centre's Unified Pension Scheme (UPS), the National Pension Scheme (NPS) and the revised pension scheme announced by the state government in the budget session.

CM Shinde thereby clarified that the employees didn't need to opt for the UPS only. In response to the CM's assurance, the employee unions have suspended their agitation.

The late Wednesday night meeting took place days after the Maharashtra Cabinet decided to implement the Centre's UPS for the state government employees in Maharashtra. The employee unions had expressed their reservations as they wanted the state government to reconsider its decision and give options to the employees. They had pressed for the implementation of the revised pension scheme announced in the state legislature.

"All the officers and employees are part of the government. It is our feeling that everyone should get justice and a sustainable pension. The government is of the view that it will not allow the officers and employees to suffer. Keeping in mind the demands of the organisations, it has been decided to give an opportunity to opt for NPS of the Central government, Unified Pension Scheme and Revised Pension Scheme announced by the State government. In the wake of these three options, officials and employees will be able to study them thoroughly and select one of them that is beneficial for them,'' said CM Shinde after the meeting.

Under the Unified Pension Scheme, retirees receive a pension of 50 per cent of their average basic pay from the last 12 months of service, provided they have completed at least 25 years of service. For those with 10 to 25 years of service, the pension is proportionate to their service duration. The new scheme will be effective on April 1, 2025. The scheme's benefits will apply to those who retire by March 31, 2025, including the payment of any arrears.

As far as NPS is concerned, employees are required to contribute 10 per cent of their basic salary plus Dearness Allowance (DA), with a matching contribution from the government. This contribution rate increased to 14 per cent in 2019. However, NPS does not guarantee a fixed pension amount as it depends on the total accumulated corpus and the returns on investments.

In the case of the state government's revised pension scheme, the employees will get a pension equal to 50 per cent of their last salary plus dearness allowance and 60 per cent of the family pension.

Meanwhile, CM Shinde directed the administration to bring before the cabinet a proposal for the implementation of the Old Pension Scheme to the Zilla Parishad officers and employees whose advertisement for their recruitment was released before November 1, 2005. He instructed the concerned departments to review the implementation of their demands in this regard.

There are 13.45 lakh state government employees and also from local self-government. Of the 13.45 lakh employees, 8.27 lakh employees are presently covered under the National Pension Scheme.