ISLAMABAD: The government has prepared multiple proposals to increase salaries and pensions for salaried employees and pensioners in the upcoming federal budget, with final approval subject to consent from the federal cabinet and the International Monetary Fund.
According to sources, a proposal to increase salaries of government employees by around 10 percent is under consideration for the next budget. Another proposal suggests merging one of the four ad-hoc allowances granted between 2022 and 2025 into the basic salary structure.
Sources said the government is also considering relief measures for salaried individuals earning between Rs100,000 and Rs200,000 per month.
In addition, proposals are being reviewed to increase conveyance allowance for officers in grades 20 to 22 by 50 to 75 percent. A disparity allowance for employees from grades 1 to 16 is also under consideration.
For pensioners, a proposal has been suggested to increase pensions by up to 80 percent in line with the average inflation rate recorded over the last two years.
According to sources, income tax reductions are expected for salaried individuals earning between Rs1.2 million and Rs2.2 million annually.
Negotiations with the IMF regarding salary increases and tax relief measures are reportedly ongoing. Sources further revealed that a proposal is also under review to include the armed forces in a contributory pension scheme from the next fiscal year.
The proposals related to salaries and pensions will be presented before the prime minister and the federal cabinet for approval.
Meanwhile, due to rising petroleum prices, a proposal to double conveyance allowance for employees from grades 1 to 19 is also under consideration.
