The Khyber Pakhtunkhwa (KP) government is likely to propose a 10% salary increase and a 7% pension hike for government employees in its upcoming budget for the fiscal year 2025–26.
The total proposed budget stands at Rs2,070 billion, with Rs1,352 billion earmarked for current expenditures. Of this, Rs680 billion may go towards salaries, and Rs200 billion for pensions. KP is also expected to receive Rs1,148 billion from the federal government under the National Finance Commission (NFC) award.
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Similarly, the Punjab government is expected to introduce the same percentage of pay and pension increases in its budget, set to be unveiled on June 16. Sources indicate Punjab will avoid new taxes and may allocate an additional Rs90 billion to healthcare. Plans also include support for farmers through subsidies on wheat and rice seeds, as well as fertilizers.
Earlier, Federal Finance Minister Muhammad Aurangzeb announced a nationwide 10% salary raise and 7% pension increase for government employees in grades 1 to 22, effective from July 2025, pending parliamentary approval.
