Daily Times

The finance ministry on Monday clarified in a statement that no proposals to raise government salaries were under consideration after media reports claimed that government salaries and pensions would remain unchanged in the upcoming fiscal year.

According to the statement, Finance Minister Muhammad Aurangzeb submitted a written reply to a question asked by PTI MNA and Chief Whip Malik Amir Dogar during today’s session of the National Assembly, about the possibility of increased salaries, allowances and pensions in the next fiscal year.

“The finance minister did not make any such announcement or statements while addressing the floor of the National Assembly,” the statement read. “The news broadcast attributed to him in this regard is not based on reality.”

The statement added that in his written response, Aurangzeb did not mention any revisions to pay scales for government employees.

The ministry added that it has informed the NA about the situation and that at present, “the proposal to revise the pay scales of federal government employees for the next financial year and to significantly increase their salaries and allowances is not under consideration”.

However, Aurangzeb confirmed that “after receiving the revised market survey from the ministry of housing and works, the issue of increasing the rent limit for availing the services of privately owned residential houses is under consideration”.

In the 2024-25 budget, the government announced a 20-25 per cent increase in salaries and a 15pc increase in pensions for government servants.

This was notified in July last year, with the government allowing Ad hoc Relief Allowance-2024 (ARA) at the rate of 25pc of running basic pay for basic pay scale (BPS) 1 to 16 and 20pc for BPS 17 to 22.

This applied to all federal government employees including armed forces personnel, civil armed forces and civil employees, as well as the civilians paid from Defence Estimates.

Separately, Aurangzeb has stated that government measures against illegal money transfers through Hawala and Hundi have led to a substantial increase in remittances.

During a question-and-answer session in the National Assembly on Monday, Senator Aurangzeb responded to a query from Syed Rafiullah, explaining that several actions were taken in the last quarter of the 2023 financial year to curb illegal financial practices. The government launched a crackdown on unauthorized money transfer operators and implemented administrative measures to regulate the sector.

To ensure a secure and legal remittance process, the State Bank of Pakistan increased the capital requirements for exchange companies, allowing only credible businesses to operate. Additionally, ten banks were directed to establish exchange counters to facilitate legal transactions. As a result, remittances previously routed through illegal channels are now being transferred through formal banking systems, significantly boosting overall inflows.

The Finance Minister revealed that remittances stood at $30.2 billion in the 2024 fiscal year, and with the ongoing reforms, this figure is expected to rise to between $35 billion to $36 billion by the end of the current financial year. He attributed this substantial increase to measures taken by both the caretaker and current governments to eliminate illegal money transfers and provide enhanced facilities for overseas Pakistanis.