Railway Ministry announces Unified Pension Scheme rules

The Railway Ministry has released a new framework for the Unified Pension Scheme (UPS) for permanent railway employees who joined on or after January 1, 2004. The rules, published in the Gazette of India, outline the transition process between the National Pension System (NPS) and the UPS.

Under the UPS, employees who complete 25 years of qualifying service are guaranteed a pension equal to 50% of their average basic salary from the 12 months immediately preceding retirement. For those with between 10 and 25 years of service, the payment is determined on a pro-rata basis. A minimum assured pension of ₹10,000 is available after 10 years of service.

The framework also includes provisions for Voluntary Retirement Scheme (VRS) after 20 years of regular service. Employees opting for VRS may receive a lump sum payment and final withdrawal benefits, with assured payments determined pro-rata based on length of service. Both employees and the government will contribute 10% of the basic salary and Dearness Allowance (DA) to individual accounts.