ISLAMABAD – The federal government has mulled increasing the salaries of government employees by up to 50 percent, as well as 30 increment in the pensions for retired public sector employees in the upcoming budget.
A report in Daily Jang quoting sources said government has decided to increase the salaries and pensions as fifth populous nation took the crown for Asia’s fastest inflation from bankrupt Sri Lanka as the local currency nosedived while food and energy costs skyrocketed.
It was reported that Finance Minister will finalise a strategy in this regard after a meeting with ruling alliance members ahead of the budget, which is expected to be tabled in the first or second week of June.
As Pakistan is reeling from unprecedented inflation, the incumbent government mulled raising the monthly minimum wage of laborers to Rs40000 to provide relief to the distressed masses who are struggling to pay for basic commodities.
Suggestions have also been given that the federal government should provide ample relief to the people in its last budget, and in this regard, the price of petrol and diesel should also be reduced by up to Rs100 per litre. The governments election-oriented is likely a breath of fresh air for government employees as short-term inflation climbed to a new high of 48.35 percent for the week.
IMF restricts Pakistan from giving subsidy without approval
As the government is planning to give relief before going into elections, the International Monetary Fund warned the government from increasing interest rates to stabilize inflation.
In a Memorandum of Economic and Financial Policies (MEFP), the US-based lender made it clear that Islamabad will not provide any kind of additional subsidy without prior approval of financial institution as both sides struggle to arrive at a consensus on fiscal adjustment plans.
Cash-strapped Pakistan and IMF have been negotiating an agreement for the tranche of bailout funds however despite multiple meetings and completing all conditions laid forth by the Fund, the coalition government failed to salvage much-needed funds.
