The federal government has reduced the General Provident Fund (GP Fund) mark-up rate for the financial year 2025-26. The new rate will affect the returns government employees receive on their accumulated savings.
According to a notification issued by the Ministry of Finance, the government has fixed the GP Fund mark-up at 12.05 percent. The revised rate will apply from July 1, 2025, for the financial year 2025-26.
The latest adjustment means government employees will receive a slightly lower return compared with the previous financial year.
GP Fund Return Reduced From Previous Year
The government had set the GP Fund mark-up rate at 12.46 percent for the financial year 2024-25.
The new rate of 12.05 percent represents a reduction of 0.41 percentage points. Consequently, government employees will earn a lower return on their GP Fund savings during the current financial year.
The change follows the federal government’s annual review of the return applicable to the savings scheme. The Ministry of Finance issued the notification to formally communicate the revised rate.
For employees who rely on their provident fund as a long-term source of savings, even a modest reduction can affect the amount accumulated over time.
What Is the General Provident Fund?
The General Provident Fund is a contributory savings scheme available to government employees. Workers contribute to the fund during their service, allowing them to build savings for their future financial needs.
The federal government determines the annual rate of return on GP Fund balances. Therefore, the applicable mark-up can change from one financial year to another.
For 2025-26, the government has set the return at 12.05 percent. The rate will apply from July 1, 2025, under the latest notification.
The reduction from the previous year’s 12.46 percent rate means employees will see a small decline in their annual return. Nevertheless, the GP Fund remains an important savings mechanism for government workers.
