CCGGOO slams Unified Pension Scheme, calls for restoration of OPS

The Confederation of Central Government Gazetted Officers Organizations (CCGGOO) has sharply criticized the Union Cabinet’s recent approval of the Unified Pension Scheme (UPS), labeling it as a deceptive attempt to undermine the rightful benefits of government employees. The organization is calling for the immediate reinstatement of the Old Pension Scheme (OPS), which they argue provides more secure and fair retirement benefits.

Background: The shift from OPS to NPS

The Old Pension Scheme (OPS) was a non-contributory, assured pension system governed by the Central Civil Service Rules, 1972, and later updated in 2021. However, in 2004, the NDA government introduced the National Pension Scheme (NPS) through an Executive Order, applying to employees recruited after January 1, 2004. This move, which lacked parliamentary oversight, faced immediate and widespread opposition from government employees, officers, and trade unions. Their ongoing struggle to restore OPS continued even after the Pension Fund Regulatory and Development Authority (PFRDA) Act of 2013 provided a statutory basis for NPS.

CCGGOO’s concerns with UPS

The government’s approval of the UPS, following recommendations from the T V Somanathan Committee, has been met with skepticism by CCGGOO. They argue that UPS is merely a rebranded version of NPS, offering minimal improvements while still depriving employees of the benefits they enjoyed under OPS. The introduction of UPS, with its mixed features of NPS and a truncated version of OPS, is viewed as a calculated move to protect the interests of speculative capital rather than the welfare of employees.

Under UPS, employees must continue contributing 10% of their salaries, while the government’s contribution increases to 18.5% from the current 14%. Unlike NPS, where employees could withdraw 60% of their pension wealth and invest the remaining 40% in an annuity, UPS mandates that the entire pension wealth be forfeited to the government in exchange for a fixed percentage of their emoluments upon retirement. This, according to CCGGOO, is a significant downgrade from the benefits offered under OPS.

Comparing pension benefits: OPS vs. UPS

Under OPS, employees with a minimum of 10 years of service are entitled to 50% of their last drawn pay as pension. This benefit also extends to voluntary retirement after 20 years of service. In contrast, UPS offers proportionately reduced pensions for employees with less than 25 years of service. For example, an employee with 20 years of service would receive only 40% of their average basic pay over the last 12 months as a pension. The minimum pension under UPS is set at Rs 10,000, significantly lower than the Rs 14,130 minimum pension expected under OPS by April 2025.

Family pensions under UPS are also less favourable. While OPS provides 50% of the last drawn pay as a family pension if the pensioner dies within seven years of retirement, UPS offers only 30% of the last drawn pay after 25 years of service. Moreover, the minimum family pension under UPS is Rs 6,000, compared to Rs 14,130 under OPS.

Additional benefits: OPS vs. UPS

The OPS provides additional pension benefits for pensioners who reach certain age milestones, starting at 20% for those aged 80 and above. These increments increase with age, providing a more secure financial future for retirees. UPS, however, does not offer these age-related increments, further reducing its attractiveness compared to OPS. Furthermore, OPS includes a provision for pension revision whenever a Pay Commission is implemented, a feature absent in UPS.

CCGGOO’s call to action

Given these concerns, CCGGOO has called for the immediate restoration of OPS, which they believe is the only fair and just system for government employees. The organization urges all citizens to support the ongoing protests and actions led by central and state government employees, officers, teachers, and paramilitary pensioners in their fight to reinstate OPS.

The views expressed in this article are solely those of V Krishna Mohan, National Chairman, Confederation of Central Government Gazetted Officers Organisations (CCGGOO), and Secretary, All Pensioners and Retired Persons Association (TAPRPA), Hyderabad.