ISLAMABAD – Pakistani government unveiled major pension reforms as part of Budget 2024-2025, in bid to improve fiscal stability and ensure more sustainable pension system.
In a budget speech, Finance Minister Aurangzeb highlighted that over past decades, several executive orders led to changes in the pension scheme, which eventually put a lot of burden on the national kitty. To address this, the government is now implementing fundamental reforms.
Finance Minister said the primary goal of these reforms is to stabilize public finances and create a more equitable and efficient pension system.
Budget 2025-26
New measures include discouraging early retirement, linking pension increases to the Consumer Price Index to better reflect inflation, and limiting the duration of family pensions after the death of a spouse to ten years.
Furthermore, new reforms introduce restrictions on re-employment after retirement, requiring government employees to choose between receiving a pension or a salary if they return to work. These changes are expected to have major impact on government employees and pensioners in line with government’s broader efforts to strengthen fiscal management.
The announcement has been widely viewed as positive step towards ensuring long-term financial sustainability for the country. Experts believe these reforms will help improve the government’s financial health and contribute to economic stability in the years ahead.
