ISLAMABAD – Budget 2024-25 is around the corner and all eyes are on salary and pension hike as people in Pakistan are facing back-breaking inflation, rupee devaluation, and other economic woes.
The federal government is mulling several proposals to increase salaries of public sector employees’ by up to 15percent in the upcoming2024-25 budget. Besides facing pressure from public sector for raise, the incumbent authorities must demonstrate political will by implementing stringent fiscal measures like cutting expenditures.
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Sources familiar with the development told media that Ministry of Finance is planning to propose for 10percent salary increase, but it could be around 12.50-15 percent.
Another proposal under consideration involves increasing the monetisation of cars for grades 20, 21, and 22 officers by 20 to 25pc. Currently, grade 20 officers receive Rs67,000 per month, grade 21 officers receive Rs77,000, and grade 22 officers receive Rs87,000. This policy, which has not been adjusted since its inception in 2012, is being reviewed in light of inflationary pressures.
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The alliance government is preparing to introduce pension reforms in 2024-25 budget. One proposal includes taxing pensioners who receive over Rs100,000 per month, with different tax slabs for higher-income pensioners potentially being introduced.
Officials also mentioned proposals to raise the retirement age for public sector employees by two to five years and to introduce a comprehensive package of pension reforms.
Federal government employees would be entitled to a gross pension based on 70 percent of the average pensionable emoluments drawn during the last 3 years of service before retirement.
