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1Clear out junk files and repair common Windows errors2Fix the driver behind crashes, sound loss and screen glitches3Repair Windows errors before they cause bigger problemsPakistan’s Finance Division sanctioned a 7% increase in net pension for covered Federal Government pensioners, effective July 1, 2025. The announcement was issued in a memorandum dated July 7, 2025. It concerns federal pensioners and does not establish a matching increase for provincial pensioners or confirm the pension rate currently being paid in 2026.
When did the 7% pension increase take effect?
The increase took effect on July 1, 2025, despite the Finance Division memorandum being dated July 7, 2025. The memorandum says the President sanctioned the 7% increase from July 1 for covered federal pensioners. This is a historical 2025 adjustment; the July memorandum and August clarification do not establish whether a later increase took effect in 2026.
Who is eligible for the federal pension increase?
The July 2025 memorandum covers these groups:
- Civil pensioners of the Federal Government, including civilians paid from Defence Estimates.
- Retired Armed Forces personnel and Civil Armed Forces personnel.
- Eligible pensioners retiring on or after July 1, 2025.
- Family pensioners under the Pension-cum-Gratuity Scheme, 1954, and the Liberalised Pension Rules, 1977, as amended.
- Recipients of pensions under the Federal Civil Services (Extraordinary Pension) Rules.
- Recipients of the Compassionate Allowance under CSR-353.
The notice is federal in scope. It does not by itself establish eligibility for pensioners covered by provincial governments.
How is the 7% pension increase calculated?
Pensioners already drawing a pension on June 30, 2025
For the increase in the July memorandum, “net pension” means the net pension being drawn on June 30, 2025, minus the medical allowance. The memorandum identifies that amount as the baseline for computing the increase and says the increase is maintained as a separate amount under a Finance Division memorandum dated January 1, 2025. The 7% applies to that defined baseline, not automatically to every component of a pension payment.
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Government servants retiring on or after July 1, 2025
A Finance Division clarification dated August 5, 2025 sets a different baseline for government servants retiring on or after July 1, 2025: net pension—gross pension less the commuted portion—plus specified earlier increases. Those increases are 15% (2011), 7.5% (2015), 15% (2022), 17.5% (2023), and 15% (2024). This clarification addresses the baseline for that group; it should not be applied indiscriminately to all pensioners.
What exclusions and shared-payment rules apply?
The increase does not apply to special additional pension allowed in lieu of pre-retirement orderly allowance or to the monetized value of a driver or orderly. Where the Federal Government shares gross pension liability with another government under the cited Accounts Code provisions, the increase is apportioned proportionately rather than treated as solely a federal liability.
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What the 2025 announcement does—and does not—confirm
The Finance Division’s July 7, 2025 memorandum confirms a 7% increase from July 1, 2025 for the federal categories it names, with an August clarification on the baseline for government servants retiring from that date. These documents do not establish that provincial pensioners were covered or that 7% remains the applicable rate in October 2026. For a current payment amount or a subsequent adjustment, pensioners should check the latest notice from the authority responsible for their pension.
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