In a landmark move, the Central Government has announced that all employees under the Unified Pension Scheme (UPS) will now be entitled to Retirement Gratuity and Death Gratuity, just like those under the Old Pension Scheme (OPS). The announcement was made by Union Minister of State Dr. Jitendra Singh, bringing much-awaited relief to lakhs of central government employees.
This reform aligns UPS benefits with those available under OPS and marks a key milestone in enhancing social security for all categories of government employees enrolled under the National Pension System (NPS).
Gratuity Benefits Extended to UPS Employees
Previously, gratuity benefits under the Central Civil Services (Payment of Gratuity under NPS) Rules, 2021 were only available to OPS employees. Now, with this policy revision, UPS employees will also be eligible for:
Retirement Gratuity
Death Gratuity
Disability and Invalidity-related gratuity
The benefits are applicable under the same terms and conditions that govern gratuity payments for OPS employees.
A Significant Step Toward Pension Parity
The announcement fulfills a long-standing demand of UPS employees for parity in post-retirement benefits. It reflects the government’s commitment to ensuring fairness and social security for all employees—regardless of which pension scheme they fall under.
According to the Ministry of Personnel, UPS employees must formally record their option for gratuity benefits in their service records to be eligible.
Government Orders Issued
The Department of Pension and Pensioners’ Welfare has issued an official memorandum dated 18 June 2025, clarifying that:
Employees who opt for UPS under NPS—as notified by the Department of Financial Services (MoF) on 24 January 2025—will be fully eligible for gratuity benefits under the Central Civil Services Rules, 2021.
The original notification had allowed employees entering Central Government Civil Services after 1 April 2025 a one-time option to join UPS. Now, with this clarification, gratuity benefits under UPS will match those available to OPS members.
Impact on Central Government Employees
This pension reform is expected to directly benefit lakhs of current and future Central Government employees, improving their retirement security and family protection in the event of death or disability.
By aligning gratuity benefits across pension schemes, the government aims to create a fairer and more transparent retirement system for its workforce.
Conclusion
The extension of Retirement and Death Gratuity to all UPS government employees is a significant step toward pension equity in India’s civil services. This move not only honors the government’s promise of strengthening social security, but also enhances the confidence of employees entering the Unified Pension Scheme.
Author Profile
- My name is Kuldeep Singh Chundawat. I am an experienced content writer with several years of expertise in the field. Currently, I contribute to Daily Kiran, creating engaging and informative content across a variety of categories including technology, health, travel, education, and automobiles. My goal is to deliver accurate, insightful, and captivating information through my words to help readers stay informed and empowered.
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