Cover all central govt employees under Old Pension Scheme; UPS will not satisfy…, employees union tells govt

OPS Vs UPS: The Centre recently announced the Unified Pension Scheme (UPS), which is expected to cover around 23 lakh central government employees, for those who are presently covered under the National Pension System (NPS). The new pension scheme is expected to be rolled out from April 1, 2025.

Despite the UPS announcement, some employee unions are adamant on their demand for the restoration of the Old Pension Scheme (OPS), which guarantees a pension equivalent to 50% of the last drawn salary after retirement. Under the OPS, there was no provision of any monthly contribution from employees.

IRTSA writes to govt on OPS restoration demand

The Indian Railways Technical Supervisors’ Association (IRTSA) has urged the government to restore the Old Pension Scheme (OPS) for all central government employees, citing concerns about stability, dignity, and financial security after retirement.

In a memorandum dated November 18, 2024, IRTSA highlighted various shortcomings of UPS and demanded equality in pension benefits.

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Concerns over Unified Pension Scheme (UPS)

IRTSA pointed out that UPS, set to be implemented from April 1, 2025, for 23 lakh central government employees, fails to address the principle of “Equal Pay for Equal Work.” While UPS promises 50% pension after 25 years of service, a minimum pension of Rs 10,000 for 10 years of service, and inflation-proof pensions, IRTSA highlighted several key issues:

Longer Service Requirement: UPS requires 25 years of service for pension eligibility, compared to 20 years under OPS.

Employee Contributions: Employees must continue contributing 10% of their basic pay and DA without proportionate returns.

Inflation Protection Concerns: While UPS claims to adjust pensions for inflation, doubts remain about the starting rate for Dearness Relief (DR).

No Additional Pension Benefits: Unlike OPS, UPS does not provide additional pension increments after the age of 80.

Judicial and pay commission observations

IRTSA cited past judgments by the Supreme Court, which emphasised that pension is a “valuable right” and cannot be forfeited arbitrarily. The 5th Pay Commission also affirmed that pensions are a statutory, enforceable right and not a form of charity.

“In the past on many occasions, judgements of the Hon’ble Supreme Court of India strongly recommended pension payment practice. The Supreme Court held that pension is a valuable right vested on Government employees. Refusal, reduction, forfeiture of pension not allowed unless on extreme conditions,” the notification said.

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Comparison of OPS, NPS and UPS

The association criticized the existence of three separate pension schemes — OPS, National Pension System (NPS), and UPS — creating disparities among employees holding similar posts. It argued that this violates Articles 14 and 16 of the Constitution, which guarantee equality before the law and equal opportunity in public employment.

Demand for equality and stability

IRTSA concluded by urging the government to reinstate OPS for all central government employees to ensure equality and provide stable and dignified financial security post-retirement. It emphasized that such a move would address long-standing concerns and align with constitutional principles.