ISLAMABAD: Federal Minister for Finance and Revenue Senator Muhammad Aurangzeb said that the government aims to introduce pension reforms as it plans structural reforms, ahead of inking a new deal with the International Monetary Fund (IMF).
The government was considering raising the retirement age to control the pension burden, Addressing media persons on Tuesday, the Finance Minister, while sitting alongside Federal Law Minister Azam Tarar and Information Minister Atta Tarar, said that steps must be taken to bring pension expenses under control.
Finance Minister Muhammad Aurangzeb said That, “Age is now just a number. 60 is the new 40,”
Finance Minister, described the pension as a “big liability” and added that the government has to ascertain how to lead it forward.
The ex- CEO of Habib Bank Limited (HBL) Aurangzeb said that, “The institution I left before coming here, we took this first step that we raised the retirement age from 60 to 65 because those are your productive years and you can use its result by extending the term”.
He stressed the need for changing the service structure over a period of time to overcome the pension burden.
In its fiscal year 2023-24, Pakistan allocated Rs801 billion for superannuation allowances and pensions, up 31% from the Rs609 billion budgeted for the previous fiscal year.
Meanwhile, Federal Law Minister Azam Nazir Tarar said that pension reforms will be held across the board, for which legislation is required.
The law minister informed that a committee has been formed under the chair of the Finance Minister to propose recommendations pertaining to pension reforms.
“It will be across the board. Legislation is required for this as civil servants, armed forces, judicial organs, and executive organs are included,” he said and added that the prime minister has formed a committee under finance minister leadership to overlook the matter.
Minister for Finance Muhammad Aurangzeb has said the confidence of investors is increasing on Pakistan as a result of its march towards stability.
he said that, the visit of Saudi delegation remained very successful. He said the Saudi delegation evinced confidence in Pakistan’s economy.
Muhammad Aurangzeb said the IMF team is expected to visit Pakistan this month during which the contours of a larger and longer program will be discussed. He said our focus is to ensure macro-economic stability and structural reforms.
The finance minister Aurangzeb reiterated that all IMF recommendations benefit the country. “Thus I term it a Pakistan programme, which is supported, assisted and funded by the IMF,” he said.
The Finance Minister highlighted the need for enhancing the tax to GDP ratio to thirteen to fourteen percent. He said reforms in the energy sector will be carried out and losses of state-owned enterprises will be reduced.
