The Securities and Exchange Commission of Pakistan (SECP) has published a White Paper following the National Workshop on Transitioning to a Defined Contribution (DC) Pension Scheme.
The workshop convened senior representatives from federal and provincial governments, the insurance and pension fund industries, and international development partners to discuss the shift from Pakistan’s fiscally unsustainable Defined Benefit (DB) pension model to a more transparent, sustainable, and inclusive Defined Contribution system, implemented under SECP’s Voluntary Pension System (VPS) framework.
The Government of Khyber Pakhtunkhwa (KPK) initiated DC pension reforms in July 2022. Under the new system, all newly hired employees are enrolled in a DC scheme, with contributions of 10% from employees and 12% from the employer.
Following this, the Punjab government also notified its own DC pension rules, signalling momentum for broader reforms. Other provinces are currently in the process of drafting and implementing similar frameworks.
The timing of the national workshop was therefore critical, bringing together stakeholders to share lessons learned, identify challenges, and coordinate efforts for a smooth transition.
The SECP’s White Paper consolidates key insights from the workshop, highlights progress made by provincial governments, and presents actionable policy and institutional recommendations to support a coordinated national rollout of the DC pension system. These include finalizing the Pension Scheme framework, ensuring tax consistency, amending labour laws, and increasing employee awareness.
The document aims to serve as a reference point for stakeholders working toward a long-term, equitable pension reform agenda in Pakistan.