New Delhi. A major change has been made in the pension system of railway employees. After the implementation of the Unified Pension Scheme (UPS) Rules, 2026, eligible employees will get new provisions related to pension after retirement, family pension and lump sum payment at the time of retirement. This arrangement is said to mainly relate to employees appointed after January 1, 2004.
In the new system, there is a provision to get 50 percent of the average basic salary of the 12 consecutive months before retirement as pension to an employee who has completed 25 years of regular service. At the same time, for employees whose service period is between 10 to 25 years, their pension will be decided on the basis of proportion of service. A provision of monthly minimum pension of Rs 10,000 has been made for employees who have completed at least 10 years of qualifying service.
The family will get 60 percent pension
UPS also has a provision for pension for the family of an employee after his death. Under this, 60 percent of the assured pension amount of the eligible pensioner will be given as family pension. With this, the employee's family will continue to get regular financial assistance.
Lump sum payment on retirement
In the new system, there is also a provision to give a lump sum amount at the time of retirement. For every six months of completed service, payment equal to one-tenth of the amount made up of the last basic pay and dearness allowance will be paid.
Option to invest in NPS also
Changes have also been made in the investment options for NPS contributors along with UPS. Employees can choose the automatic investment option, in which the ratio of contribution to different assets will be fixed. Apart from this, under the active option, employees will be able to decide the allocation of investment of their contributions themselves.
Employees opting for UPS have also been given the opportunity to revert to NPS once during their service period. In this way, along with pension, family security and benefits at the time of retirement have also been included in the new system.