The federal government has formally adopted the rules of the federal government’s defined Pension Fund Scheme, 2024, a change in the partnership framework under the traditional non -controversial pension model under SRO 1728 (I)/2025.
The date of August 27, 2025, this notification was circulated in ministries and federal agencies for immediate implementation. Under the new rules, pensions of federal employees will be determined by the partnership of both employers and employees.
For civilian federal staff, the employer will contribute 12 % of the salary, and the employee will contribute 10 %. The scheme cannot be implemented for the Armed Forces, where currents are currently at zero.
Sources say the reforms are designed to reduce financial tensions and improve the long -term stability of the pension system. The contribution of all parties will be set up in a dedicated fund, and the investment return will determine the final pension payments.
This change has identified the most fruitful reforms in Pakistan’s public financial management over the years, as the rising pension responsibilities made it difficult for the old system to withstand.
This information has been sent to the Auditor General of Pakistan (AGR), Pakistan Revenue (AGPR) Accountant General, State Bank of Pakistan (SBP), and all relevant ministries, including defense, education, railway, energy, IT, climate change, among others, among others.
There has been a balloon of pension responsibilities recently in Pakistan. In fiscal year 25, the federal pension bill (including military pensions) 1 trillion, makes it one of the repeated costs and puts pressure on the national budget.
Reforms are a part of Pakistan’s commitment to the IMF programs to trimstown unstable responsibilities and promote financial stability.