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  • Writer's pictureRaj

Central Government Employees Can Now Opt for Old Pension Scheme

Old Pension Scheme Came Now

Old Pension Scheme Came Now

In a significant decision to address a wide range of litigations, the government has introduced a one-time option for select Central government employees to switch to the Old Pension Scheme (OPS). This option is available to those who applied for jobs advertised before December 22, 2003, when the National Pension System (NPS) was notified. However, they commenced their service in 2004, coinciding with the implementation of the NPS.

One-Time Option for Central Government Employees

Central government employees who joined the service on or after January 1, 2004, under the National Pension System (NPS), even though the posts were advertised before December 22, 2003, now have the chance to choose the Old Pension Scheme (OPS). This opportunity also extends to Central Armed Police Force (CAPF) personnel and other Central government employees who joined in 2004 due to administrative delays in the recruitment process.

Time Limit for Opting for OPS

The eligible employees have until August 31 to exercise their option to switch to the Old Pension Scheme. After this deadline, they will no longer have the opportunity to migrate to OPS.

Background of the Decision

The move to allow select Central government employees to move to OPS comes after the government faced numerous litigations in courts across the country. Remarkably, the government failed to win any case in these litigations, leading individual officials to obtain benefits through court orders. To address this issue, the Department of Pension and Pensioners’ Welfare (DPPW) engaged in thorough consultations with the Ministries of Finance and Law, as well as the Departments of Expenditure and Personnel. As a result of these discussions, they collectively agreed to provide employees with the choice to switch to the Old Pension Scheme (OPS).

Coverage Under the New Order

The number of employees covered under the new order has yet to be discovered. This will be determined once eligible employees have exercised the option.

Participatory Scheme vs Defined Pension Benefit Scheme

The OPS, also referred to as the Defined Pension Benefit Scheme, provides a steady income throughout retirement, usually amounting to 50% of the last drawn salary. The government takes responsibility for covering the expenses related to the pension. In contrast, the NPS, introduced in 2004, operates as a participatory scheme wherein employees contribute to the pension fund from their salaries, and the government matches their contributions. Additionally, the NPS is market-linked and subject to market performance.

Reverting to the Old System

The Bharatiya Janata Party-led government has maintained that reverting to the Old Pension Scheme would impose an unnecessary financial burden. Conversely, several states governed by the Opposition, including Chhattisgarh, Rajasthan, Jharkhand, and Himachal Pradesh, have declared their plans to reinstate the OPS.

Support from Employee Unions

The All India Defence Employees Federation, one of the government employee unions, welcomed the decision to extend the OPS benefits to similarly placed employees. However, they plan to continue their struggle to withdraw the NPS and restore the OPS completely. this tax scheme for only central government jobs pension holders.


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