Revised NPS optional for employees, says Maharashtra govt

Mumbai: The Maharashtra government has made its revised National Pension Scheme optional for employees covered under the existing NPS, according to a circular released by the state finance department on Wednesday.

The circular laid down a detailed procedure about the implementation of the revised National Pension Scheme (NPS) for those government employees who choose to opt for it, and clarified that the scheme will apply only to those who exercise the option within the stipulated deadline.

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The government had earlier allowed eligible and willing employees to submit their option to join the revised scheme by December 31, 2026.

The Maharashtra cabinet had a couple of years back approved the implementation of a revised NPS for state government employees on the lines of the Centre’s Unified Pension Scheme (UPS).

As per the new circular, uploaded on the government's website, employees retiring at the prescribed age with 20 years or more of service and opting for the revised scheme will be entitled to a pension equal to 50 percent of their last drawn salary, along with dearness allowance.

For those with service between 10 and 20 years, the pension will be proportionate to the length of service based on the last drawn salary, it said.

The government has fixed a minimum pension of Rs 7,500 per month for employees retiring after at least 10 years of service under the revised scheme, while those with less than 10 years of service will not be eligible for pension benefits.

As per the circular, the government also provides for a family pension at 60 percent of the admissible pension along with dearness relief.

It mandates that employees opting for the revised scheme must deposit 60 percent of the accumulated corpus received from the Pension Fund Regulatory and Development Authority (PFRDA) with the government through the drawing and disbursing officer at the time of retirement.

The remaining 40 percent of the accumulated fund will be utilised to purchase an annuity, and the annuity amount will be adjusted against the pension payable by the state government.

The circular stated that any withdrawals made earlier from the NPS corpus must be refunded with 10 percent interest by employees opting for the revised scheme, failing which the pension entitlement will be reduced accordingly.

Employees who resign from service will not be eligible for pension under the revised scheme and will continue to receive benefits only under the existing NPS framework.

The government has also clarified that retirement gratuity will be applicable to those opting for the revised scheme as per earlier orders issued in March 2023.

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The provisions mentioned in the circular will also apply, with suitable modifications, to employees of aided educational institutions, agricultural universities and affiliated non-government colleges, as well as staff of zilla parishads and panchayat samitis.

The finance department said a separate detailed procedure will be released for the disbursement of pension under the revised scheme.

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