Pension

Notification / OM No. No.FD-SR-III-4-239/2023 Dated 19-February-2025 Notification Issued By: Finance Department, Government Of The Punjab Punjab’s New Pension Scheme 2025 – What It Means for Government Employees: In a significant move towards pension reform, the Punjab Government has officially announced the Punjab Defined Contribution Pension Scheme Rules 2025 through a formal notification. This new scheme is set to redefine the pension structure for newly appointed government employees, ensuring a sustainable retirement fund model. Under this scheme, both employees and the government will contribute to a dedicated pension account, which will be invested through approved pension fund managers. Employees will have the choice between conventional and Shariah-compliant investment options, allowing flexibility in financial planning for retirement. This reform aims to modernize the pension system by aligning it with international best practices, ensuring financial security for employees while reducing the long-term burden on the provincial government. The new rules apply to civil servants hired after the enactment of the Punjab Civil Servants (Amendment) Ordinance 2023 and those regularized under new government policies. The notification details the governance, contribution structure, roles of employees and employers, and fund management policies to be followed under the new pension scheme. Please find the official notification below: GOVERNMENT OF THE PUNJABFINANCE DEPARTMENTDated: Lahore, the 19th February,2025 Notification No.FD-SR-III-4-239/2023. In exercise of the powers conferred under section 23 of the Punjab Civil Servants Act, 1974 (VIII of 1974), Governor of the Punjab is pleased to make the following rules: 1.         Short title, commencement and application.- (1) These rules may be cited as the Punjab Defined Contribution Pension Scheme Rules 2025. (2) They shall come into force at once. (3) They shall apply to all the employees mentioned in clause (g) of sub-rule (1) of rule 2 of the rules. 2.         Definitions.- (1) In the rules, unless the subject or context requires otherwise: (a)       “Accountant General” means the Accountant General, Punjab; (b)       “Act” means the Punjab Civil Servants Act, 1974 (VIII of 1974); (c)       “allocation policy” means allocation of contributions, in various sub-funds of an employer pension fund, in accordance with the rules and governed by the Voluntary Pension System Rules, 2005 and the Non- Banking Finance Companies Regulations, 2008; (d)       “conventional fund” means a type of employer pension fund, to be managed by the Eligible Pension Fund Manager, in a conventional manner, in accordance with the Voluntary Pension System Rules, 2005; (e)        “Defined Contribution Pension Scheme” means the Defined Contribution Pension Scheme as specified in section 18-A of the Act and the rules and governed in accordance with the Voluntary Pension System Rules, 2005 and the Non-Banking Finance Companies Regulations, 2008, in which both the employer and employee contribute, as per the First Schedule, to the employee’s pension account, opened with an Eligible Pension Fund Manager of the employee’s choice and such contributions are invested in an employer pension fund, as defined under the Voluntary Pension System Rules, 2005, either in a conventional fund or a Shariah compliant fund, as selected by the employee, until the employee attains retirement age, and the accumulated balance in the pension account at the time of retirement is withdrawn or invested further to generate monthly income during the post- retirement phase, subject to exceptions under the rules; (f)        “Eligible Pension Fund Manager” means a Pension Fund Manager who qualifies the criteria as specified in sub-rule (13) of rule 4 and has entered into an agreement with the employer to establish and manage employer pension funds for the employees; (g)       “employee” means: (i)        a person appointed on or after the commencement of the Punjab Civil Servants (Amendment) Ordinance 2023 (I of 2024) but not including any person who was appointed as Government servant holding pensionable post before the commencement of the said Ordinance, and was subsequently inducted into any Provincial service through proper channel after coming into force of the Punjab Civil Servants (Amendment) Ordinance 2023 (I of 2024); or (ii)       a person regularized as a civil servant through any legal instrument issued on or after the commencement of the Punjab Civil Servants (Amendment) Ordinance 2023 (I of 2024) and shall be considered an employee for the purposes of the rules from the date of issuance of such legal instrument, regardless of the effective date of regularization. Provided that an employee shall, subject to sub-rule (3) of rule 5 of the rules, be deemed to be an employee solely for the purposes of the Defined Contribution Pension Scheme until reaching retirement age and no further contributions shall be made to his pension account by either the employer or the employee in the event of his leaving service before attaining retirement age for any reason whatsoever. (h)       “employee’s contribution” means the amount computed by multiplying the employee’s pensionable pay with the employee’s contribution rate specified in the First Schedule; (i)        “employer” means the Government; (j)        “employer’s contribution” means the amount computed by multiplying the employee’s pensionable pay with the employer’s contribution rate specified in the First Schedule; (k)       “Finance Department” means the Department, Government of the Punjab; (l)        “overall contribution” means the sum of employer’s contribution and employee’s contribution as per the First Schedule; (m)      “pension account” means an account opened and maintained by an employee with the Eligible Pension Fund Manager as per the Voluntary Pension System Rules, 2005; (n)       “Pension Fund Manager Agreement” means an agreement between the employer and the Eligible Pension Fund Manager for the Defined Contribution Pension Scheme; (o)       “pensionable pay” means the running basic pay but does not include any other pay, allowances or perquisites; (p)       “retirement age” means the retirement age as specified in section 12 of the Act; (q)       “rules” means the Punjab Defined Contribution Pension Scheme Rules 2025; (r)        “salary” means the monthly amount being drawn as pay and allowances by the employee; (s)        “Schedule” means the Schedule appended to the rules; and (t)        “Shariah compliant fund” means a type of employer pension fund, governed by the requirements of Shariah

Notification / OM No. NO.FD.SR-III-4-244/2023(A) Dated 02-December-2024 Notification Issued By: Finance Department, Government Of The Punjab Revised Pension Framework for Future Retirees: Punjab Government Notification: The Government of Punjab, through the Finance Department, has issued a critical notification dated December 2, 2024, regarding significant changes in the pension policies for future retirees. This decision, communicated under the directive of the Governor of Punjab, signals a shift in the financial framework concerning pensions, aiming to streamline and revise the provision of retirement benefits. The notification outlines specific increases in pensions that have now been discontinued for all individuals retiring after the issuance of this letter. Addressed to high-ranking officials across the administrative spectrum of Punjab, including commissioners, deputy commissioners, heads of attached departments, and judicial authorities, the directive underscores the importance of uniform implementation across all departments. The pension increases previously granted through circulars dated July 2011, July 2015, and July 2022 have now been rescinded. Furthermore, all existing rules and instructions related to this subject have been revised accordingly. This notification represents the government’s initiative to align pension policies with current fiscal realities. By updating the framework, the government aims to ensure financial sustainability while meeting administrative obligations. The announcement is a testament to the evolving economic and policy priorities of Punjab, reflecting a balance between fiscal responsibility and the welfare of its retirees. Notification Describes; NO.FD.SR-III-4-244/2023(A)GOVERNMENT OF THE PUNJABFINANCE DEPARTMENT Dated: Lahore, the 2nd December, 2024 From Mr. Mujahid SherdilFinance Secretary To Additional Chief Secretary, South Punjab All Administrative Secretaries to Government of the Punjab The Secretary to Governor, Punjab, Lahore The Secretary to Chief Minister, Punjab, Lahore The Military Secretary to Governor, Punjab, Lahore All Commissioners in the Punjab All Deputy Commissioners in the Punjab All Heads of Attached Departments in the Punjab The Registrar, Lahore High Court, Lahore All District & Sessions Judges in the Punjab The Secretary, Punjab Public Service Commission, Lahore The Secretary, Punjab Provincial Assembly, Lahore The Provincial Director, Local Fund Audit, Punjab, Lahore The Chief Inspector of Treasuries & Accounts, Punjab, Lahore The Chief Pilot, VIP Flight, Lahore Subject :-       PENSION INCREASES                               I am directed to state that Governor of the Punjab has been pleased to approve that the following increases shall be discontinued with immediate effect to the future retirees retiring after issuance of this letter. 2.                           All existing rules / orders / notifications / circular / instructions on the subject shall be deemed to have been modified to the extent as indicated above. ADDL. FINANCE SECRETARY (REG) Conclusion: The recent directive by the Punjab Finance Department to discontinue specific pension increases marks a pivotal development in the province’s financial policies. By rescinding allowances granted in prior notifications, the government seeks to implement reforms that address the evolving economic landscape and budgetary constraints. This step reflects a proactive approach toward ensuring sustainable financial management while maintaining fairness and transparency in public service retirement policies. The notification’s clear articulation of revised terms provides departments and officials with a roadmap for uniform implementation. While this decision impacts future retirees, it underscores the government’s emphasis on fiscal prudence and equitable resource allocation. As part of broader administrative and financial reforms, this policy change highlights the importance of aligning public service benefits with long-term fiscal strategies. The Punjab Government’s commitment to effective governance and financial discipline remains evident through such measures. Officials and departments are expected to adhere to these revised policies and ensure timely communication of these changes to all concerned stakeholders. This initiative, though challenging, reflects the province’s dedication to fostering a sustainable and accountable governance framework for the betterment of its citizens and public servants. For more information, clarification or any other question feel free to join our WhatsApp Group. We are a supportive community where members are committed to assisting one another.