However, this may not be the case if the NPS is mandated to manage the individual pension fund, one of the two funds proposed under the UPS.
The individual fund will hold the employee contribution of 10% of basic pay and dearness allowance and the matching government contribution.
The additional government contribution of 8.5% of basic and DA of all employees will be held in a separate fund.
Currently, the NPS has 2.65 million central government subscribers, accounting for 27.1% of the ₹12.8 lakh crore corpus of the scheme. It is not yet clear what will happen to this corpus when central government employees migrate to the UPS.
The new scheme will roll out from April 1, 2025.
If states also roll out a UPS-type scheme, offering NPS subscribers the option to shift, the impact would be bigger. The NPS has 6.7 million subscribers from states, accounting for 49.4% of the total scheme corpus.
Together, state and central government employees account for over three-fourths of the scheme corpus, the latest data shows. The corporate sector subscribers add up to 2.1 million with a total corpus of ₹1.89 lakh crore, or 14.8% of the total.
The scheme offers tax rebate on contributions. On maturity, 60% of the corpus can be withdrawn tax free while for the balance, the subscriber has to purchase annuity.
