Tamil Nadu launches new pension scheme

Chennai: The Tamil Nadu government has launched a new pension plan called the Tamil Nadu Assured Pension Scheme (TAPS). This replaces the old system that had been in place for 23 years.

TAPS is a mix of two older systems. It gives employees a guaranteed amount of money (like the Old Pension Scheme) but also requires them to save some of their own money (like the National Pension System).

Key Features of TAPS

• Guaranteed Pay: When you retire, you will get a monthly pension equal to 50% of your last salary (basic pay plus dearness allowance).
• Cost of Living Adjustments: Your pension will increase whenever the government raises the “Dearness Allowance” (DA) for regular workers to help with rising prices.
• Monthly Savings: Employees will contribute 10% of their monthly salary toward their pension. The government will pay for any extra money needed to reach the guaranteed 50% mark.
• Family Protection: If a pensioner passes away, their family will receive 60% of that pension every month.
• Retirement Bonus (Gratuity): Upon retirement or death, a lump sum will be paid based on how long the person worked, up to a maximum of ₹25 lakh.

Who is Covered?

• New Employees: Anyone joining the Tamil Nadu government from January 1, 2026, must join TAPS.
• Current Employees: People who were under the previous system (CPS) and retire after January 1, 2026, will be covered by TAPS.
• A Choice for Seniors: Those who were already working before 2026 can choose between the new TAPS benefits or their old CPS benefits when they retire.
• Special Help: People who retired under the old system before TAPS started will receive a special “compassionate pension” based on how many years they worked.

When Does It Start?

The scheme officially began on January 1, 2026. However, the government still needs to release the specific “fine print” and accounting rules before it is fully active.