ISLAMABAD: In a move aimed at providing relief to public servants, the government has officially announced a 15% hike in pensions and a 20-25% increase in salaries, effective from July 1.
According to notifications issued by the Ministry of Finance, the government has also imposed a cap, limiting public servants to earning a maximum of Rs1 million annually from their memberships on corporate boards. Any excess earnings beyond this limit must be deposited into the government treasury, with detailed financial disclosures required to be submitted to the Ministry of Finance.
The notifications further detail the implementation of the Ad hoc Relief Allowance-2024 (ARA), which grants a 25% increase on the running basic pay for employees in Basic Pay Scales (BPS) 1 to 16, and a 20% increase for those in BPS 17 to 22. This allowance will be subject to income tax and applicable during all types of leave, excluding extraordinary leave. Importantly, it will not factor into pension or gratuity calculations, nor will it be granted to employees serving on international postings.
Additionally, the Ministry of Finance has ensured that the 15% increase in net pension applies uniformly to all civil pensioners, including those from defence estimates, retired armed forces personnel, and civil armed forces. This increase excludes special additional pensions and monetized allowances.
The notifications underscore that any pensions shared with other governments will see the increase apportioned proportionally between the federal government and the other involved government.
These measures aim to alleviate financial pressures on public servants and retirees amidst ongoing economic challenges faced by the government.
