The Old Pension Scheme (OPS), which guarantees a fixed retirement income, is making a limited return for specific categories of government employees. Recent decisions by the Central government and the state of Andhra Pradesh are offering eligible staff an opportunity to switch from the National Pension System (NPS) or Contributory Pension Scheme (CPS) back to the older, more secure OPS.
Centre Expands OPS Eligibility for Compassionate Appointees
The Department of Pension and Pensioners' Welfare (DoPPW) issued a clarification on June 22, 2026, allowing certain compassionate ground appointees to be covered under the Central Civil Services (Pension) Rules, 2021. This means employees who applied for appointment on or before January 1, 2004—the date NPS came into force for Central government employees—but joined service after this cutoff, can now opt for OPS.
Many such appointees were automatically placed under NPS despite their recruitment process beginning when OPS was still operational. This clarification aims to address these anomalies. The Council of Scientific and Industrial Research (CSIR) has already begun implementing this decision as of July 7, 2026, setting a potential precedent for other Central Autonomous Bodies, though each body must independently adopt the Centre's decision.
Andhra Pradesh Follows Suit with One-Time Option
In a similar move, the Andhra Pradesh government announced a one-time option via a circular on July 13, 2026. This allows employees covered under the Contributory Pension Scheme (CPS) to switch to OPS. Eligibility is extended to those recruited through advertisements issued before September 1, 2004, but who joined state government service on or after that date, when CPS became effective in Andhra Pradesh. Employees must exercise this option within a specified period, and the choice will be final and irrevocable.
Understanding the Pension Schemes: OPS, NPS, and UPS
These developments highlight the differing structures of India's pension frameworks:
- Old Pension Scheme (OPS): Offers a guaranteed pension equal to 50% of the employee's last drawn salary, plus Dearness Allowance. Employees make no contributions during service.
- National Pension System (NPS): A market-linked, contributory scheme. Employees contribute 10% of their basic pay and DA, while the government contributes 14%. Retirement benefits depend on market performance.
- Unified Pension Scheme (UPS): Combines features, requiring a 10% employee contribution and an 18.5% government contribution. It guarantees a pension of 50% of the average basic pay from the last 12 months, with inflation indexation and family pension benefits.
Not a Universal Restoration, But a Policy Trend
These latest measures are not a blanket restoration of the Old Pension Scheme. Instead, they represent a targeted effort by governments to rectify specific recruitment-related anomalies, ensuring employees are not disadvantaged by administrative delays in their appointment process. While the NPS remains the default framework for most Central government employees who joined after January 1, 2004, these growing exceptions indicate a broader policy trend towards addressing long-standing grievances related to pension timing discrepancies.