26 Aug 2025 : The central government has introduced an important and flexible option for central employees regarding pensions. The Ministry of Finance has decided to give employees who are covered under the Old Pension Scheme (OPS) the option to shift to the New Pension Scheme (NPS). This decision could prove to be a relief for those employees who are looking for a practical and transparent retirement option for the future.
Only one chance will be given
The government has clarified that employees can switch from OPS to NPS only once, and this decision will be valid in one direction only. Employees who plan to take voluntary retirement (VRS) will have to opt for this choice at least 3 months before retirement, while those going for normal retirement can switch up to one year before retirement.
What will change after switching?
Employees who leave OPS and join NPS will no longer get the benefit of a guaranteed pension. Instead, the central government will contribute an additional 4% to their NPS account. After retirement, they will receive the benefits under NPS as per PFRDA’s 2015 Exit and Withdrawal Rules.
Who cannot switch?
The following employees will not be eligible for this option:
- Those facing disciplinary action
- Those who have been dismissed from service
- Those who do not opt for the switch within the given time limit
Employees who do not switch will automatically continue under OPS, and no further chance to change will be given in the future.
The government believes this initiative can make the pension system simpler, more transparent, and more flexible. According to the Finance Minister, so far 7,253 OPS-related pension claims have been received, out of which 4,978 claims have already been settled. At present, around 25,756 retired employees are eligible for additional benefits under OPS.
Summary:
The government now allows employees to shift from Old Pension Scheme (OPS) to New Pension Scheme (NPS) under new rules.