One of the most searched questions after the presentation of Punjab’s 2025–26 budget was: Is there any increase in salaries or pensions? The answer is a clear yes.
As part of its people-friendly fiscal policy, the Government of Punjab has announced a 10% salary hike for all provincial government employees from Grades 1 to 22, along with a 5% increase in pensions for retired public servants. These adjustments reflect the administration’s intent to support those who keep the province running — both current employees and retired personnel.
Why This Matters
In the face of rising inflation and economic pressure on households, this increment is timely and significant. For instance, a government employee earning PKR 60,000 will now receive an additional PKR 6,000 each month. For pensioners, especially those on fixed incomes, the 5% raise offers tangible relief.
These increases were implemented without imposing any new taxes, preserving the pro-people character of the budget. Notably, the overall increase in current expenditure was contained to just 3%, reflecting fiscal responsibility despite the adjustments in salaries and pensions.
Fiscal Responsibility Maintained
What makes this announcement stand out is that it comes alongside a record PKR 1240 billion development budget — a 47% increase from the previous year — while still maintaining a budget surplus. This balance between social relief and financial discipline indicates strong budget planning and prioritization.
Broader Impacts
- Public Service Motivation: Improved compensation boosts morale across government departments, potentially enhancing service delivery.
- Economic Multiplier: Higher disposable incomes for thousands of employees and retirees can stimulate local markets and businesses.
- Support for Vulnerable Groups: For many retirees and low-income staff, this increase is not just helpful — it’s essential.
A Continuing Trend
Last year, the Punjab government implemented even steeper pay and pension hikes, showcasing a trend of consistently recognizing the challenges faced by public sector workers. While the percentage increase this year is more modest, it’s more measured and better aligned with long-term economic goals.
Conclusion
The salary and pension increases in Punjab’s 2025–26 budget are not just about numbers — they are a reflection of the government’s intent to improve livelihoods while managing fiscal realities. It’s a welcome move for thousands of employees and retirees, offering both relief and respect in difficult economic times.
As the province continues to invest in health, education, infrastructure, and digital transformation, this balanced approach ensures that the people who make these sectors function are not left behind.
