F.No. 9(3)R-6/2024-403
01-January-2025
Regulations Wing, Finance Division, Government of Pakistan
Finance Division Introduces New Methodology for Future Pension Increases:
The Government of Pakistan, through the Finance Division (Regulations Wing), is steadfast in its commitment to enhancing pension policies for federal employees and retirees. In light of the recommendations made by the Pay and Pension Commission-2020, a revised methodology for future pension increases has been approved. This new approach seeks to establish a more transparent, structured, and equitable system for determining pension adjustments. The details of the updated methodology, designed to ensure fairness and consistency in pensionary benefits, are outlined in this notification. Notification Describes;
Government of Pakistan
Finance Division
(Regulations Wing)
F.No. 9(3)R-6/2024-403
Islamabad, the 1st January, 2025
OFFICE MEMORANDUM
Subject :- FUTURE INCREASE METHODOLOGY IN PENSION
The undersigned is directed to refer to the subject noted above and to state that, on the recommendations of Pay and Pension Commission-2020, it has been decided that henceforth future increase methodology in pension shall be as under.
a. The net pension [Gross Pension less Commuted portion of Pension] calculated at the time of retirement will be termed as baseline pension.
b. Any increase in pension shall be granted on baseline pension.
c. Each increase shall be maintained as a separate amount until the time, the Federal Government decides to review and authorize any additional pensionary benefits.
d. Baseline pension will be reviewed by Pay and Pension Committee after every 3 years.
Provided that the current pension of existing pensioners on the date of issuance of this O.M. shall be considered as baseline pension.
Provided further that baseline pension is deemed to include restored commuted portion of pension as and when restored.
2. Existing instructions on the subject shall stand amended to the extent of above with immediate effect.
Deputy Secretary(R-III)
Conclusion:
This revised methodology represents a significant stride toward fostering clarity and fairness in pension management. By introducing the concept of a baseline pension and periodic reviews, the policy aims to create a sustainable and accountable framework for future pension increases. All relevant departments and stakeholders are encouraged to implement these amendments promptly and in accordance with the outlined guidelines. For further information or assistance, please contact the Finance Division (Regulations Wing) at the provided phone number.
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