Comprehensive strategy implemented to tackle inflation, recover wages, NA told

(Web Desk) - Minister of State for Finance and Revenue Bilal Azhar Kayani informed the National Assembly on Thursday that the government has implemented a comprehensive strategy to tackle inflation, restore real wages to 2017 levels, and provide targeted financial relief to low-income citizens.

Responding to a query from Dr Mahreen Razzaq Bhutto, Kayani acknowledged that inflation had significantly diminished the purchasing power of the average Pakistani.

“We understand that this is one of the most pressing issues for citizens and a fundamental benchmark for assessing our economic policies,” he said.

According to the written reply submitted to the House, inflation has seen a notable drop from 23.4 percent in FY2024 to 4.5 percent in FY2025. For July FY2026, inflation was recorded at 4.1 percent compared to 11.1 percent during the same month last year.

The government outlined several key fiscal measures in its budget response. These include a 10 percent ad-hoc salary increase for civil servants, a 7 percent pension raise, no imposition of new income taxes, and enhanced subsidies for utility bills and the Benazir Income Support Programme (BISP), which has been expanded to Rs716 billion.

Efforts to enhance labor productivity were also highlighted, focusing on skill development, vocational training, digitization, entrepreneurship, investment in capital goods, and the formalization of the labor market.

“Formal firms tend to pay higher and more regular wages,” the government stated, noting that improved employment elasticity tied to GDP growth would further support wage recovery.