Archive · 19 Dec 2025
Government Rules Out Old Pension Scheme Restoration
The Indian government has said no to bringing back the Old Pension Scheme (OPS) for its employees.
Only a small number of employees have chosen the new Unified Pension Scheme (UPS), which is why some people want the old system back.
The OPS gives a fixed pension based on the last salary, while the UPS and the older National Pension System (NPS) depend on contributions and investments.
Some states like Rajasthan and Punjab have brought back the OPS for their employees, but the central government is not changing its mind.
Employees are worried about getting their contributions back and prefer the certainty of the OPS.
Additionally, new NPS rules in 2025 have made exits more flexible, especially for private sector employees, who can withdraw a larger portion of their savings compared to government employees.
Only 1.22 lakh out of 23 lakh central government employees have opted for the Unified Pension Scheme (UPS).
The government has ruled out restoring the Old Pension Scheme (OPS) for central employees.
OPS offers a fixed pension linked to the last drawn salary, while UPS and NPS are contribution-based.
Several states, including Rajasthan and Punjab, have reinstated OPS for their employees.
Employees remain skeptical of UPS due to its contribution-driven nature and lack of full OPS benefits.
- Who
- Central government employees and state governments
- What
- Debate over the restoration of the Old Pension Scheme (OPS) and new NPS exit norms
- When
- December 15, 2023 (Lok Sabha response) and 2025 (NPS amendments)
- Where
- India
- Why
- Low uptake of the Unified Pension Scheme (UPS) and demands from employee unions and opposition MPs, along with new NPS rules differentiating government and private sector employees
- UPS Opt-In Rate
- 1.22 lakh out of 23 lakh eligible employees
- OPS Pension Calculation
- 50% of last drawn basic pay
- UPS Minimum Pension
- ₹10,000 per month
- UPS Family Pension
- 60% of employee’s payout
- UPS Withdrawal at Retirement
- Up to 60% of corpus
- States Reinstating OPS
- Rajasthan, Chhattisgarh, Jharkhand, Punjab, Himachal Pradesh
- Government’s Stance on OPS
- No proposal under consideration for restoration
- NPS Full Withdrawal Limit
- 100% withdrawal allowed if corpus is up to ₹8 lakh
- Annuity Requirement for Government NPS
- 40% of corpus if exceeds ₹12 lakh
- Annuity Requirement for Private NPS
- 20% of corpus
- Lump Sum Withdrawal for Government NPS
- Up to 60% of corpus
- Lump Sum Withdrawal for Private NPS
- Up to 80% of corpus
Sources
Old Pension Scheme to be restored for central govt employees? Finance Ministry replies as R’sthan, Punjab, Chhattisgarh back on OPS
What new NPS norms say: 80% higher lump sum withdrawal for non-govt subscribers, exit age raised to 85
