CHENNAI: Accepting a long-pending demand of government employees and teachers, including the umbrella organisation JACTTO-GEO, which had announced a statewide protest on January 6, Chief Minister MK Stalin on Saturday announced a pension scheme exclusively for Tamil Nadu to replace the existing Contributory Pension Scheme (CPS). The scheme, estimated to cost Rs 13,000 crore to the State exchequer, has been named the Tamil Nadu Assured Pension Scheme (TAPS).
JACTTO-GEO and other major employee associations have welcomed the decision and withdrew the proposed indefinite strike. Leaders of the associations met the chief minister at the Secretariat on Saturday and thanked him and exchanged sweets.
In a statement, the chief minister said that the implementation of TAPS would require a recurring annual expenditure of about Rs 11,000 crore, which is expected to rise year after year in line with salary revisions for government staff.
The State government has put a full stop to the pension issue faced by govt staff and teachers with the announcement of the Tamil Nadu Assured Pension Scheme
K Venkatesan, Coordinator of JACTTO-GEO
Posting on X, he said the announcement reflected the government’s commitment to fulfilling promises made to the people. He described TAPS as a New Year and Pongal gift for government employees, adding that once the State’s financial position improves, demands from other sectors would also be addressed.
Assuring employees and teachers, the chief minister said that despite financial constraints, the government had decided to bear the entire expenditure. He appealed to staff associations to accept TAPS, stating that the government had addressed a 20-year-old demand and implemented a scheme broadly comparable to the Old Pension Scheme.
A three-member committee, which was formed by the government to review the Old Pension Scheme, has submitted its report to Chief Minister MK Stalin within 11 months of its formation.
IAS officer Gagandeep Singh Bedi, former director of Madras School of Economics, KR Shanmugam were members of the Committee, which was formed by the State government in February 2025. IAS officer Pratik Tayal acted as the Member Secretary of the panel.
It is gratifying to note that the Tamil Nadu government's Assured Pension Scheme offers more benefits in some aspects compared to the Central government's Unified Pension Scheme. The TAPS is a prime example that a harmonious solution can be found if any problem is approached with an open mind and goodwill
P Chidambaram, Sr Cong leader & former Union FM
As per the scheme, gratuity up to Rs 25 lakh will be paid on retirement or in the event of death during service, based on the length of service.
Reacting to Stalin’s new pension scheme, former Union Finance Minister P Chidambaram said the Tamil Nadu Assured Pension Scheme (TAPS) has been formulated based on two key principles: a guaranteed pension of 50% of the last drawn salary for government employees and teachers, which they greatly desired, and a 10% contribution from the beneficiaries to the pension fund.
"I welcome and appreciate the government's objective of ensuring the livelihood of the employees and teachers. At the same time, I commend the government employees and teachers for accepting the necessity of contributing to the pension fund," he said.
TAPS Vs UPS
Assured Pension: Monthly pension equivalent to 50% of last drawn salary; UPS assured employees with at least 25 years of service 50% of the average basic pay last drawn
Contribution Structure: Employees contribute 10%, remaining borne by the State; under UPS, employee contribution is at 10% of basic pay plus DA, the govt's contribution increased from 14% to 18.5%
Lump-sum Payment: DA extended to pensioners every six months (in line with DA revisions for serving employees); under UPS, employees receive a one-time payment equal to 1/10th of monthly emoluments for every six months of completed service, in addition to gratuity
Family Pension: Family pension for nominees (spouse) will be 60% of the pension amount; same as under UPS
Minimum Pension: Employees, teachers, who retire without meeting the eligibility criteria for full pension, will receive a minimum assured pension; UPS assured guaranteed minimum pension of Rs 10,000 per month for employees with at least 10 years of service
Proportionate Pension: Under UPS, pension is calculated proportionately for service between 10 and 25 years; TAPS is mum on it
Special pension: TAPS assures a special pension arrangement for employees who joined service under Comprehensive Pension Scheme and retired under it