Kerala Introduces Assured Pension Scheme for State Employees

In a significant policy shift, the Kerala government has rolled out a new Assured Pension Scheme, set to take effect from April 1, 2026. This scheme is designed to replace the existing National Pension System (NPS), offering state employees more favorable retirement benefits.

Finance Minister K N Balagopal announced the plan during the state Budget, highlighting the feature of a minimum pension guaranteed to government employees. Notably, new hires from the specified date will have the option to choose between the Assured Pension Scheme and the NPS, while current NPS-enrolled employees can switch to the new scheme.

Essentially, the new scheme allows for a maximum pension amounting to 50% of the last drawn basic pay, plus Dearness Relief. To fully benefit, employees need to complete 30 years of qualifying service. The government plans to release comprehensive guidelines soon.