Mumbai: The Maharashtra government has announced that its recently updated National Pension Scheme (NPS) will be an optional choice for staff currently enrolled in the existing NPS framework. According to a State Finance Department circular issued on Wednesday, the implementation of this revised scheme will be restricted to those who formally opt-in within the designated timeframe.

Earlier, the state government set a deadline of December 31, 2026 for eligible and willing employees to submit their choice to join the new system. This move follows the Maharashtra Cabinet’s decision to align state pension benefits with the Central Government’s Unified Pension Scheme (UPS).

Key highlights of the revised scheme

Pension calculation: Employees retiring at the standard age with a minimum of 20 years of service will be "entitled to a pension equal to 50 per cent of their last drawn salary, along with dearness allowance."

Proportionate benefits: For those completing between 10 and 20 years of service, the pension amount will be calculated proportionately based on their tenure and final salary.

Minimum guarantee: The government has established a "minimum pension of Rs 7,500 per month for employees retiring after at least 10 years of service”. Staff with less than a decade of service will not qualify for pension benefits.

Family security: The circular also outlines a "family pension at 60 per cent of the admissible pension along with dearness relief”.

Financial guidelines and procedures

Under the new rules, employees choosing the revised plan must surrender 60% of their accumulated PFRDA corpus to the government via their drawing and disbursing officer upon retirement. The remaining 40% will be used to buy an annuity, which will then be adjusted against the state-provided pension.

Furthermore, any prior withdrawals from the NPS corpus must be repaid with 10% interest. Failure to do so will result in a corresponding reduction in pension entitlements. The government clarified that those who resign will remain under the original NPS framework and will not be eligible for the revised benefits.

These provisions extend to employees of aided educational institutions, zilla parishads, panchayat samitis and agricultural universities.

PTI