Islamabad, July 5, 2025: The finance government on Friday issued regarding a notification for a 10 per cent rise in the salaries of federal government workers, alongside the approval of a Disparity Reduction Allowance (DRA) equivalent to 30 per cent of basic salary.
The rise was declared within the budget for the financial year 2025, whereas the pay of federal employees ranging from Grade 1 to 22 would be raised by 10 per cent, while retired officials would receive a 7 per cent increase in their pensions.
As outlined in one of the notifation, dated July 4, the basic salary of armed forces members, civil armed forces, and civilian staff of the federal government would be subjected to this raise.
The notification stated that the salary enhancement would be “subject to income tax; admissible during leave and entire period of LPR except during extraordinary leave; will not be treated as part of emoluments for the purpose of calculation of pension/gratuity and recovery of house rent.”
Moreover, it clarified that the enhanced pay would “not be admissible to the employees during the tenure of their posting/deputation abroad; and will be admissible to the employees on their repatriation from posting/deputation abroad at the rate and amount which would have been admissible to them had they not been posted abroad. ”
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In a separate directive, also dated July 4, it was mentioned that federal government personnel from Grades 1 to 22 are allowed to draw DRA at 30 per cent of their basic salary. The provision covers those already availing DRA.
“For those employees who have been appointed on or after July 1, 2022, this allowance will be admissible on the basis of the relevant initial Basic Pay Scale of 2017,” the document noted.
According to the notification, this allowance will be effective from July 1, 2025, and will be given based on the basic salary as of June 30, 2022.
