ISLAMABAD: The Ministry of Finance has announced a substantial benefit for retired federal government personnel by approving an increase in their pensions. An official Office Memorandum detailing this decision has been issued.
The memorandum clarified that, “To ensure equitable treatment, it is specified that for government employees retiring on or after July 1, 2025, the baseline pension will be calculated as the net pension (gross pension minus the commuted portion) with the following increases applied.”
The Ministry also revealed that five previously granted ad-hoc relief allowances—namely 15% in 2011, 7.5% in 2015, 15% in 2022, 17.5% in 2023, and 15% in 2024—will now be incorporated into the pension calculations. Collectively, these reliefs amount to an overall increase of up to 70%, which will be reflected in the net pension of federal retirees.
Earlier, the federal cabinet approved a 15% hike in pensions provided by the Employees’ Old-Age Benefits Institution (EOBI), effective from January 1, 2025. This decision was made based on the recommendation of the Ministry of Overseas Pakistanis and Human Resource Development and will be financed through EOBI’s own resources.
During the cabinet meeting, chaired by Prime Minister Muhammad Shehbaz Sharif, the government also agreed to establish a committee tasked with implementing reforms within EOBI. The committee will explore proposals to extend old-age benefits to informal workers, including domestic workers, agricultural laborers, and other marginalized employment groups that have historically been excluded from social security coverage.
The reforms aim to provide social protection to these underserved sectors. Additionally, the cabinet approved the initiation of legal procedures for the draft Sea Carriage Shipping Documents Bill, 2025, based on a recommendation from the Ministry of Maritime Affairs.
Furthermore, the cabinet approved a five-year extension for the exemption on importing essential medicines such as anti-cancer, cardiac, and life-saving drugs used in hospitals and healthcare facilities. This measure, advised by the Ministry of National Health Services, aims to ensure the timely availability of vital medicines crucial for saving lives.
