Sindh Cabinet okays pension reforms to save Rs894bn


The provincial cabinet of Sindh considering the significance and future financial implications of the pension payments has approved a Pension Reforms Scheme under which around Rs894.4 billion would be saved, otherwise the pension bill of the government would surpass the salary bill within next 10 years.

The meeting was held under the chairmanship of Sindh Chief Minister Syed Murad Ali Shah at CM House on Friday. The provincial ministers, advisors, Chief Secretary Mumtaz Shah and other concerned officers attended the meeting.

The chief minister being in-charge minister of the finance department told the cabinet that in 2012 the number of government employees were 477,570 and their monthly salary and pension bill was Rs11.78 billion and RS6.523 billion respectively.

He added that in 2020 the number of employees increased to 493,182 and the monthly salary bill increased to RS23.97 billion while the pension bill rose to RS13.329 billion.

“If the same post-retirement liabilities, including pension, commuted value of pension, gratuity, family pension and others are continued unabated the pension bill will exceed the salary bill within next 10 years,” he said and added therefore a study has been conducted so that necessary reforms could be introduced to control the ballooning pension bill.


Murad Ali Shah said that a restriction on early retirement (minimum 25 years of service and 55 years of age) with reduced pension, according to the number of years in service, was being proposed.

The financial impact is determined based on the assumption that the early retirement reduction factor would be 2.5 percent for each year remaining to reach 60 years of age, he said and added that the accrued pension liability would be declared by Rs433.326 billion.

The CM talking about another reform proposal said that it would be the use of average pay of the last three years of service as the basis to calculate the amount of pension instead of the last drawn salary.

The cabinet approved the Pension Reform proposal and appreciated the efforts of the chief minister to introduce reforms.

MinisterHealth DrAzraFazalPechuho presented a proposal to hand over Karachi Institute of Cardiovascular Disease (KICVD) to Sindh Institute of Cardiovascular Diseases (SICVD) so that it could be made a world class institute like NICVD and its satellites.

Secretary Health KazimJatoi giving details said that it used to conduct 9000 Echo tests, 2500 Thallium tests and 1100 ETT tests per year and its OPD has been recorded at 1000 per day.

The cabinet was told that the salary component of the KICVD was of Rs646.752 million and non-salary component Rs66.6m. It showed that the annual budget of the KICVD was Rs713.252m.

The cabinet approved handing over of KICVD to SICVD along with its staff.

The chief minister directed the health department to allocate budgetary allocations for next financial year and further modernize the institute.


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