The federal government is reportedly considering a modest relief package for public sector employees and pensioners in the upcoming Budget 2026–27, with proposals suggesting a 7 percent increase in both salaries and pensions.
According to official sources, the proposal is part of ongoing consultations ahead of the final budget announcement, which aims to balance fiscal constraints with rising inflation pressures affecting government employees across the country.
The suggested increase would apply to federal government employees from Grade 1 to Grade 22, while retired pensioners are also expected to receive a 7 percent adjustment in their monthly pensions. However, officials have clarified that the figures are still under review and no final approval has been granted.
Government insiders indicate that multiple options were discussed during budget planning meetings, including higher increases, but the 7 percent adjustment has emerged as a likely middle-ground solution given the current economic situation and IMF-related fiscal limits.
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Sources further revealed that the government is also considering a more targeted relief approach, where lower-grade employees may receive slightly better adjustments compared to senior officials. This strategy is aimed at providing greater support to low-income government workers who are most affected by inflation.
In addition to salary and pension revisions, policymakers are also evaluating broader reforms, including potential tax relief measures for the salaried class and adjustments in public expenditure to maintain fiscal discipline.
The final decision is expected to be announced in the federal budget, after approval from the cabinet and completion of negotiations with key stakeholders.
