ISLAMABAD: Finance Minister Muhammad Aurangzeb on Monday announced that there would be no salary or pension hikes for government employees in the upcoming FY2025-26 budget. In a written response to the National Assembly, the finance minister clarified that there are no proposals under consideration for increasing salaries, pensions, or revising pay scales and allowances. However, he mentioned that the government is reviewing the increase in hiring and ceiling limits for employees.
The minister emphasized that the government's primary focus is on controlling expenditures and stabilizing the economy, rather than making significant financial changes for government employees.
In a related development last year, the Ministry of Finance introduced major reforms to pension policies. One of the key amendments was limiting family pensions to 10 years. If a pensioner dies, only legal heirs are eligible to receive the pension transfer. The spouse of a deceased pensioner will continue receiving the pension for 10 years after their death. However, if a pensioner’s child is disabled, they will be eligible to receive the pension for life.
Additionally, the ministry announced measures aimed at discouraging early retirement. A 3% deduction will apply to the pension for those opting for early retirement, based on the remaining service period up to the age of 60. These changes reflect the government's efforts to streamline pension policies and manage financial resources more effectively.
