Finance Minister Nirmala Sitharaman, in a written reply to a question in the Lok Sabha, said the government had distanced itself from OPS due to the excessive fiscal burden on the exchequer.
The government said in Parliament that there is no proposal pending with the Centre to restore the Old Pension Scheme (OPS) for central government employees covered under the National Pension System (NPS). Finance Minister Nirmala Sitharaman said in a written reply to a question in the Lok Sabha that the government had distanced itself from OPS due to the excessive fiscal burden on the exchequer.
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What is the detail
NPS is a contribution-based scheme launched for Central Government employees (except armed forces) joining service on or after January 1, 2004. He said that a committee was constituted under the chairmanship of the then Finance Secretary to suggest measures for amendment in NPS with a view to improving pensionary benefits for such employees.
The reply said that based on the Committee’s deliberations with stakeholders, the Unified Pension Scheme (UPS) was introduced as an option under the NPS, which aims to provide prescribed post-retirement benefits to Central Government employees covered under the NPS. The Finance Minister informed that the features of UPS, including the definition of family, have been designed in such a way that along with ensuring payment, the financial stability of the fund is also maintained.
Benefits to these employees
She informed that government employees opting for UPS under NPS will also be eligible for the option of receiving benefits under CCS (Pension) Rules, 2021 or CCS (Extraordinary Pension) Rules, 2023 in case of retirement on the basis of death or disability during service. Sitharaman informed that UPS was introduced as an option under NPS by the government through a notification on 24 January 2025. In a written reply to another question, the minister informed that household financial liabilities have increased by about 5.5 percentage points from March 2020 to March 2024, while household financial assets have increased by 20.7 percentage points during the same period.
Further, he pointed out that as per the latest data published by the National Statistical Office (NSO), Ministry of Statistics and Programme Implementation, net domestic financial savings are set to increase from Rs 13.3 lakh crore in 2022-23 to Rs 15.5 lakh crore in 2023-24, hence it is not a systemic concern for the asset quality of Indian banks.
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