Finance Minister Considers Retirement Age Adjustment
ISLAMABAD: Finance Minister Muhammad Aurangzeb is advocating for an increase in the retirement age for government employees from 60 to 62. His rationale includes the growing burden of pension liabilities, as reported on Saturday.
Aurangzeb discussed this issue with the Senate Standing Committee on the Financial Council. This committee, led by Senator Salem Mandviwalla, is working to finalize recommendations for the Financial Bill for 2025-26.
This discussion coincides with Prime Minister Shebaz Sharif’s proposal to raise government employees’ salaries by 10% and pensions by 7% as part of the Rs17.57 trillion budget for the coming fiscal year.
During the Senate meeting, Aurangzeb pointed out that pension reforms implemented last year are applicable only to civilians. Senator Farooq H. Naek from the PPP has proposed raising the retirement age as a pragmatic approach to alleviate pension-related expenses. He questioned why this policy shouldn’t apply to bureaucrats, similar to judges whose retirement age can be extended.
Naek remarked that locking out older, more experienced individuals at 60 isn’t ideal for service efficiency. Senator Anusha Rahman echoed this by suggesting a possible extension to 65 or even 70 years. Aurangzeb referenced the banking sector’s successful adjustment to 65 as a considered precedent.
However, he cautioned the committee that increasing the retirement age might not significantly alleviate financial pressures, noting that military personnel often retire much earlier, forming a bulk of the pension liabilities.
Additionally, the Finance Ministry provided an in-depth overview of the budget, highlighting an allocation of Rs 51 crore for special packages aimed at the Army, Navy, and Air Force.
Senator Faisal Vawda emphasized the need for changes to ease the burden on the NFC, suggesting that requiring a tax certificate to purchase property is not acceptable and should be retracted. He proposed offering similar incentives for both property buyers and sellers and encouraged the Finance Minister to consider removing specific budget provisions.
On agricultural taxes, Vawda pointed out the ongoing debates, suggesting that while previously it was claimed that imposing such taxes was impossible, there’s now a path to effective collection.
