KARACHI: Government of Pakistan announced a significant increase in salaries as part of the fiscal year 2024-25 budget presented on Wednesday.
Minister for Finance and Revenue, Senator Mohammad Aurangzeb, unveiled the budget proposals, highlighting a substantial boost in salaries by up to 25 percent for government employees effective from July 1, 2024. Recognizing the challenges posed by heightened inflation, the government proposed a 20-25 percent increase in salaries on an ad-hoc basis, along with a 15 percent hike in pensions for Federal Government employees.
Despite grappling with financial constraints, the government prioritized enhancing the purchasing power of its workforce. Aurangzeb outlined that employees from Grade 1 to 16 would receive a 25 percent ad-hoc relief in their salaries, while those in Grade 17 to 22 would see a 20 percent increase. This move is poised to inject liquidity into the economy, as increased disposable income among government employees could stimulate consumer spending and boost demand for goods and services.
Moreover, Aurangzeb proposed a raise in the minimum wage, elevating it from the existing Rs 32,000 to Rs 37,000 per month. This adjustment reflects the government’s commitment to ensuring fair compensation for labor, addressing concerns related to wage stagnation and cost of living.
The decision to augment salaries and pensions underscores the government’s efforts to mitigate the adverse effects of inflation and uphold the welfare of its workforce. By providing relief measures directly impacting disposable income, the budget aims to ease financial strain on employees and enhance their standard of living.
The announcement has been met with positive reception from various quarters, with labor unions and employees expressing appreciation for the government’s responsiveness to their financial needs. Additionally, analysts foresee a potential boost to economic growth as increased consumer spending contributes to aggregate demand and stimulates economic activity.
However, some critics have raised concerns regarding the sustainability of these measures amidst fiscal constraints and the need for prudent financial management. They emphasize the importance of accompanying policies aimed at revenue generation and expenditure rationalization to ensure long-term fiscal stability.
As the budget proposals undergo deliberation and scrutiny in the legislative process, the government remains committed to fostering economic resilience and safeguarding the interests of its citizens in the face of evolving economic challenges.