The Khyber Pakhtunkhwa government has announced an increase of 16 percent in the salaries of government employees in the budget for the next fiscal year. During, the session of the provincial assembly, Finance Minister Taimoor Saleem Jaghra also revealed the pensions of government employees would also be increased by 15 percent.
The total budget allocated for salaries and pensions amounts to Rs. 447.90 billion from which Rs. 107 billion has been set aside for pensions of government employees.
Addressing the assembly, Jhagra said that the pension programs were not being abolished rather the government was setting up pension funds, and at present, new employees are being added to the pension fund under the Contributory Pension Scheme. He added that 10 percent of the basic salary of the newly recruited government employee would also be included in the scheme.
The Minister said that if a new employee has an Rs. 50,000 salary, 10 percent of their salary will be deposited in the fund which amounts to Rs. 5000. He added that the government will deposit a 12 percent amount (Rs. 6,000) as well. This will lead to an investment worth Rs. 11,000 in the fund for new employees each month.
The Minister said that in the first year, the pension contribution fund would be Rs.11 to Rs. 12 billion, in 6 years the pension fund would become Rs. 100 billion and the money invested from the pension fund would boost the economy of the province.