Pakistan Government Announces 25% Salary and 15% Pension Increases

Federal Employees and Retirees to Benefit from Significant Pay and Pension Adjustments Starting July 1, 2024

In a move aimed at alleviating financial burdens, the Pakistan government has officially announced significant salary and pension increases for federal employees and retirees. Effective from July 1, 2024, the government has declared a 15% pension increase, along with a 25% ad hoc relief for federal employees in grades 1 through 16 and a 20% increase for those in grades 17 through 22.

Breakdown of Salary Increases

According to the latest notification, federal employees will see the following adjustments to their salaries:

  • Grades 1 to 16: A substantial 25% increase in basic pay.
  • Grades 17 to 22: A 20% raise in basic pay.

These increases will be applied to the employees’ basic pay starting from July 1, 2024.

Pension Increases for Retirees

In addition to the salary hikes, federal government retirees, both civil and armed forces, will benefit from a 15% increase in their pensions. This adjustment applies to all retirees, with those retiring on or after July 1, 2024, also being eligible for the increased pension rate.

Specifics of the Ad-Hoc Relief Allowance

The ad-hoc relief allowance for 2024 comes with specific guidelines:

  • Taxable Income: The relief allowance will be subject to income tax.
  • Admissibility During Leave: It will be applicable during leave periods and the entire period of Leave Preparatory to Retirement (LPR), except during extraordinary leave.
  • Exclusions from Emoluments: The allowance will not be consider part of emoluments for calculating pension, gratuity, and recovery of house rent.
  • Deputation Abroad: The relief allowance will not be available to employees during their posting/deputation abroad. However, it will admissible upon their repatriation at the rate and amount that would have been applicable if they had not been posted abroad.

Financial Impact and Government’s Commitment

The government’s decision to increase salaries and pensions reflects its commitment to improving the financial well-being of federal employees and retirees. This move expected to provide much-needed relief amid rising living costs and economic challenges.

The 25% salary increase for grades 1 to 16 and the 20% raise for grades 17 to 22, along with the 15% pension hike, underscore the government’s effort to support its workforce and retired personnel. These changes will take effect from July 1, 2024, marking a significant step towards enhancing the financial stability of federal employees and retirees in Pakistan.

For further details and updates, federal employees and retirees encouraged to refer to the official notification or contact their respective departments.
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