Good news for pensioners as govt notifies increase starting from THIS date!

ISLAMABAD: The Finance Division has issued a formal memorandum notifying a 7% increase in net pension for all civil pensioners of the Federal Government with effect from July 1, 2025.

The adjustment will be applicable to citizens paid from the Defence Estimate as well as retired personnel of the Armed Forces and Civil Armed Forces.

According to the memorandum, the President has approved the 7% increase, which will be given to those retiring on or after July 1, 2025. The increase extends to family pension granted under the Pension-cum-Gratuity Scheme of 1954, the Liberalised Pension Rules of 1977 (as amended under the Pension Service Pension) Rules, and compassionate allowances under CSR-353.

For this purpose, “net pension” is defined as the amount of pension drawn up to June 30, 2025, excluding medical allowance. This figure will serve as a baseline for calculating this and any future increases.

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Additional pension will be maintained as a separate component as per Finance Division O.M. No. 9(3)R-6/2024-403 dated January 1, 2025. Where pension is shared between the Federal Government and another Government as per Part IV of Appendix III of the Accounts Code, Volume I, the increase will be shared proportionately.

The memorandum further clarified that this increase will not be applicable to pre-retirement orderly allowance or special additional pension given in lieu of monetized value of driver or orderly.