Govt proposes up to 35pc pay raise, 17.5 increase in pensions

Minimum wage jumps to Rs32,000 from Rs25,000

ISLAMABAD (Dunya News) – The government decided to raise the pays and pensions of serving and retired state employees of the federal departments and organisations, in a major relief to the people who are experiencing a record-high inflation.

Finance Minister Ishaq Dar on Friday told the National Assembly that the government was increasing the salaries of state employees from BPS-1 to BPS-16 by 35 per cent with a 30pc raise for BPS-17 to BPS-22 as ad hoc relief in the upcoming budget for the fiscal year 2023-24.

Similarly, the pensioners will get a 17pc raise while the minimum salary within the Islamabad Capital Territory (ICT) has been set at Rs32,000 against the previous level of Rs25,000.

The decision comes despite the very little room the Dar-led economic team has to manoeuvre through the current economic crisis and the persistent pressure exerted by the International Monetary Fund (IMF) on Pakistan to cut the government expenditure.

Although the move has been welcomed by the beneficiaries and the common people, former finance czar Miftah Ismail, who has been predicting an imminent default, was critical of the move, as he also described the budget as unsustainable.

Read more: Exchange of fire: Miftah says budget isn't sustainable, Dar ridicules default mongers

But Dar, without naming Miftah, said that said those behind the running the “Reimagining Pakistan” movement should stop frightening the people with the notion that the country would soon default.