Finance Minister Muhammad Aurangzeb announced on Tuesday key pension reforms during his Budget 2025–26 speech, aimed at reducing the financial burden on the national exchequer.
According to detail, he said: "Over the past several decades, changes made to the pension scheme through executive orders had significantly increased pressure on the state treasury. To address this issue, the government had introduced essential reforms."
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Under the new measures, early retirement would be discouraged, and pension increases would be linked to the Consumer Price Index.
Following the death of a spouse, the duration of family pension payments would be limited to ten years. In addition, the practice of receiving multiple pensions had been abolished.
The finance czar explained that, after retirement, individuals rejoining government service would have to choose between receiving a salary or a pension, but not both.
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