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Government Implements Pension Reforms to Meet IMF Requirements

Pakistan has introduced new pension reforms for retired federal government employees as part of measures to meet conditions set by the International Monetary Fund (IMF). The Ministry of Finance has issued two notifications outlining these changes.

The reforms specify that pensions will now be calculated based on the average salary over the last 24 months of service. Additionally, pensions will be adjusted annually in line with changes in average salaries.

The double pension system has been abolished. Retired employees rejoining any organization will now be required to choose between receiving either their salary or pension, but not both.

For federal government couples, specific rules have been established regarding pension eligibility. If a retired husband takes up a new job, the pension will only be granted to the retired wife. However, if both spouses are retired, they will each be entitled to individual pensions.

According to officials from the Ministry of Finance, these reforms aim to address the rising annual pension expenses and are based on recommendations from the Pay and Pension Commission. The initiative seeks to streamline pension payments and ensure the sustainability of the system while fulfilling a critical IMF requirement.


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