Islamabad, Sep 12: Government pensions increase the Finance Ministry is likely to abandon the one-time pension hike for retired civil personnel and instead raise them by 80% over the next two years in accordance with the rate of
According to sources, the Ministry of Finance is choosing a new system that links increases in pension benefits to inflation. The administration hopes to lessen the mounting pension burden on the treasury with the proposed approach.
For the current fiscal year, the government has set aside Rs. 1,014 billion for pensions.
The Finance Ministry increased pension payments to retired personnel by a flat 15 percent this year in the budget; however, the new process will modify future increases based on inflation statistics supplied by the State Bank of Pakistan.
The action, according to sources, is in line with the Pay and Pension Commission 2020’s recommendations, which supported tying pension changes to inflation.
By the upcoming fiscal year, the Finance Ministry hopes to get inflation under control by dropping it far below the single digit mark.
