Home Latest News Raising Retirement Age under Consideration to Reduce Pension Burden

Raising Retirement Age under Consideration to Reduce Pension Burden

Law minister says Parliament will be taken onboard over reform measure, as it would require legislation to implement

by Staff Report

Photo courtesy PID

Finance Minister Muhammad Aurangzeb on Tuesday announced the government is considering raising the retirement age of government employees to reduce the burden of pension payments.

Addressing a press conference with Law Minister Azam Nazeer Tarar and Information Minister Attaullah Tarar in Islamabad, he said the move—if implemented—would alter the service structure of all government employees. The law minister, likewise, said the move would be implemented through legislation, which would also take the input of Parliament. He said a committee headed by the finance minister was working on the proposed reforms.

Meanwhile, the information minister said the increase in the retirement age was part of several recommendations aimed at reducing the pension burden. “Reforms in pension structure are being mulled in the government institutions across the board,” he said, lamenting that pensions were a major reason for the government struggling to curtail expenditures.

Tarar explained that life expectancy is on the rise globally and various countries have increased retirement ages in light of this. “A section of the media was speculating that it was aimed at some specific institution which was incorrect, if approved it would be implemented across the board,” he stressed, adding the matter was still under discussion.

Aurangzeb further explained that an International Monetary Fund (IMF) team was expected to visit Pakistan later this month to iron out the contours of a larger and longer bailout. He said the government’s focus was ensuring macroeconomic stability and structural reforms.

On prevailing economic indicators, the finance minister claimed investor confidence in Pakistan was increasing as the country stabilized. “The visit of the Saudi delegation remained very successful. The Saudi delegation evinced confidence in Pakistan’s economy,” he said, reiterating the country was headed in the right direction.

Aurangzeb stressed the need to enhance the tax-to-GDP ratio to 13-14%, adding reforms in the energy sector and reduction in losses of state-owned enterprises were also on the cards.

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