Breaking News: The Controller General of Accounts (CGA) has issued a crucial office memorandum allowing Central Government employees who opted for the Unified Pension Scheme (UPS) to switch back to the National Pension System (NPS) under specific conditions. This one-time, one-way switch facility is now available through CGA Order No. TA-3-102/1/2025-TA-CGA dated 23.09.2025.
UPS to NPS Switch: Key Highlights
One-Time Facility: Only one switch allowed per employee
One-Way Process: Cannot switch back to UPS once moved to NPS
Specific Conditions: Subject to eligibility criteria and timelines
Order Reference: CGA O.M. No. TA-3-102/1/2025-TA-CGA/e-18259/347
Issue Date: 23rd September 2025
Official Order: CGA Office Memorandum
TA-3-102/1/2025-TA-CGA /e-18259/347
Ministry of Finance
Department of Expenditure
O/o Controller General of accounts
Mahalekha Niyantrak Bhawan
E-Block, GPO Complex, New Delhi-110023
Dated 23-09-2025
OFFICE MEMORANDUM
Sub.: Unified Pension Scheme (UPS)- Introduction of one-time one-way Switch facility from UPS to NPS- reg.
Reference is invited to the Department of Financial Services OM No. 1/3/2024-PR dated 25.08.2025 regarding one -time one-way switch facility from UPS to NPS.
2. It has been decided that a one-time, one-way switch facility from UPS to NPS shall be made available to all Central Government employees who have opted for UPS. This switch facility may be exercised by UPS optees any time not later than one year prior to the date of superannuation or three months prior to the deemed date of retirement in case of voluntary retirement, as applicable. Similar provisions will be made for resignation and cases of Rule 56J, with minor modifications as necessary. If switch facility not exercised as per aforesaid timelines, the employee shall continue under UPS by default.
3. The switch facility will not be allowed in case of removal, dismissal or compulsory retirement as a penalty or for cases where disciplinary proceedings are ongoing or contemplated.
4. Once the switch facility is availed, the provisions of the PFRDA (Exit & Withdrawal under NPS) Regulations, 2015 shall apply. The concerned employee shall cease to be eligible for assured payouts and UPS benefits. The Government’s differential contribution (4%) at default investment pattern will be worked out and shall be credited to the individual’s NPS corpus at the time of exit.
5. Pr. CCAs/CCAs/CAs of all the Ministries/Departments are requested to bring the contents of this O.M. to the notice of eligible officers/officials under your administrative control.
6. This issues with the approval of the Competent authority.
Sd/-
(Sanchita Shukla)
Jt. Controller General of Accounts
Who Can Switch from UPS to NPS?
Eligible Employees:
- All Central Government employees who opted for UPS
- Those not facing disciplinary proceedings
- Employees not under removal/dismissal proceedings
- Must meet timeline requirements
Exclusions:
- Cases of removal or dismissal as penalty
- Compulsory retirement as penalty
- Ongoing disciplinary proceedings
- Contemplated disciplinary actions
Switch Timeline Requirements
For Regular Retirement:
- Deadline: Not later than one year prior to superannuation date
- Default: Continue under UPS if not exercised within timeline
For Voluntary Retirement:
- Deadline: Three months prior to deemed retirement date
- Application: Must be made within specified timeframe
For Resignation:
- Similar provisions apply with minor modifications as necessary
- Specific timeline to be followed
Rule 56J Cases:
- Special provisions with minor modifications
- Timeline requirements apply
Financial Implications of Switch
UPS Benefits Lost:
- ❌ Assured minimum pension of 50% of average basic pay
- ❌ Family pension guarantee
- ❌ Additional benefits under UPS
NPS Benefits Gained:
- ✓ Market-linked returns potential
- ✓ Withdrawal flexibility as per PFRDA regulations
- ✓ Government’s differential contribution (4%) credited
Contribution Calculation:
- Government’s differential contribution (4%) worked out
- Credited to individual NPS corpus at exit time
- Default investment pattern applies
Important Conditions & Restrictions
One-Time Nature:
- ⚠️ Irreversible: Cannot switch back to UPS once moved to NPS
- ⚠️ Single Opportunity: Only one switch allowed per employee
- ⚠️ Timeline Critical: Must be exercised within specified periods
PFRDA Regulations Apply:
- Exit and withdrawal governed by PFRDA (Exit & Withdrawal under NPS) Regulations, 2015
- Standard NPS exit options available
- Annuity purchase requirements as per NPS norms
Implementation Guidelines
For Controlling Officers:
- Pr. CCAs/CCAs/CAs must inform eligible employees
- Ensure proper communication across departments
- Monitor timeline compliance
For Employees:
- Careful consideration of financial implications
- Understanding of irreversible nature
- Timely application within deadlines
- Consultation with financial advisors recommended
Comparison: UPS vs NPS Features
UPS Features:
- Assured pension of 50% of average basic pay
- Minimum pension guarantee of ₹10,000
- Family pension of 60% to spouse
- Inflation indexation
- Lump sum payment on retirement
NPS Features:
- Market-linked returns
- Employee choice in fund management
- Flexible withdrawal options
- Lower administrative costs
- No assured pension guarantee
Decision Factors to Consider
Choose UPS if:
- Prefer guaranteed pension amount
- Risk-averse investment approach
- Want assured family pension
- Prefer government backing
Choose NPS if:
- Comfortable with market risks
- Want higher return potential
- Prefer investment flexibility
- Want lower administrative costs
Application Process (Expected)
While specific application procedures are not detailed in this order, employees should:
- Consult: Financial advisors and pension experts
- Analyze: Personal financial situation and retirement goals
- Apply: Through designated channels within timeline
- Document: Maintain records of application and approvals
Key Takeaways
✓ One-time opportunity for UPS to NPS switch
✓ Irreversible decision – choose carefully
✓ Timeline critical – must apply within specified periods
✓ Financial implications significant – analyze thoroughly
✓ PFRDA regulations will govern post-switch
Official Reference
This information is based on Controller General of Accounts Office Memorandum No. TA-3-102/1/2025-TA-CGA/e-18259/347 dated 23rd September 2025, issued with competent authority approval.
For more updates on UPS, NPS, pension schemes, and Central Government employee benefits, stay connected with 8th Pay Calculator.
Reference: CGA Office Memorandum No. TA-3-102/1/2025-TA-CGA/e-18259/347 dated 23.09.2025 – Unified Pension Scheme (UPS) – Introduction of one-time one-way Switch facility from UPS to NPS