Islamabad, 6 June 2025: In preparation for the upcoming federal budget, the government is considering a series of proposals aimed at increasing salaries and pensions for public sector employees, according to official sources familiar with the matter.
Insiders revealed that the Ministry of Finance is weighing a 10% raise in both salaries and pensions of government employees in the new fiscal year.
This potential increase would apply across the board, reflecting the state’s attempt to ease financial pressure on civil servants amid persistent inflation.
Another key proposal under review is the merging of the 2022 ad-hoc allowance into the basic pay scale, a step that would effectively restructure monthly earnings for public servants and improve pension calculations. The adjustment is seen as a longer-term solution to harmonize compensation packages.
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For civil servants in grades 1 to 16, a 3% disparity allowance is also being proposed to address ongoing concerns over pay imbalances within different segments of the bureaucracy.
Meanwhile, employees in grades 17 to 22 may see a more substantial 15% salary increase, reflecting senior-level cost-of-living adjustments and performance expectations.
The proposals remain under discussion and are likely to be finalized in the days leading up to the official budget announcement, expected later this month.
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If approved, the measures would form a central part of the government’s public sector reform strategy and may also help mitigate unrest among civil service unions pushing for wage adjustments.
As the country prepares for the unveiling of the federal budget, all eyes remain on how these potential pay revisions will impact broader fiscal planning and economic recovery efforts.
