Winning Bizness Desk

Mumbai.The central government is preparing to launch a Universal Pension Scheme that will benefit all citizens, including workers from unorganized sectors. Currently, many individuals, such as construction workers, domestic staff, and gig workers, are not covered under existing government pension schemes. This new initiative aims to extend pension benefits to both salaried employees and self-employed individuals, ensuring financial security post-retirement.

The government is in the process of drafting proposal documents for this scheme. Once the initial framework is ready, it will seek inputs from relevant stakeholders before finalizing the plan. The new scheme is expected to be a significant step toward providing a comprehensive and inclusive social security net for Indian workers.

How Is It Different from Existing Pension Schemes?

According to media reports, the Universal Pension Scheme will differ from the existing pension plans as it is expected to combine multiple pension schemes into a single, unified program. Unlike current schemes, which are designed for specific worker categories, this new initiative will be open to all citizens on a voluntary basis, offering a safer and more inclusive retirement savings option.

Impact on National Pension System (NPS)

Sources indicate that the Universal Pension Scheme will not replace or merge with the National Pension System (NPS). This means that the introduction of the new pension plan will not affect the NPS, which will continue to function independently.

Current Pension Schemes in India

Several government pension schemes are already in place for workers in unorganized sectors. These include:

• Atal Pension Yojana (APY): Under this scheme, individuals receive a pension ranging from ₹1,000 to ₹5,000 per month after the age of 60.
• Pradhan Mantri Shram Yogi Maan-Dhan (PM-SYM): This scheme provides financial assistance to street vendors, domestic workers, and laborers, ensuring economic support post-retirement.
• Pradhan Mantri Kisan Maan-Dhan Yojana: Designed specifically for farmers, this scheme provides ₹3,000 per month as pension benefits after they turn 60.

Unified Pension Scheme for Government Employees

In addition to the Universal Pension Scheme, the government has also approved a new Unified Pension Scheme (UPS) exclusively for government employees.

Implementation from April 1, 2025

The Unified Pension Scheme will be implemented from April 1, 2025 and will benefit around 23 lakh government employees. Key features of this scheme include:

Employees who complete 25 years of service will receive 50% of their last 12 months’ basic salary as a pension before retirement.

Those who leave government jobs after 10 years of service will get a monthly pension of ₹10,000.

If a government employee passes away during service, their family will receive 60% of the pension amount that the employee was entitled to at the time of death.

With these new pension initiatives, the government aims to provide a robust financial security system for both private and public-sector workers, ensuring a stable post-retirement income for all.