Salaries, pensions' increase announced in federal budget 2026-2027

ISLAMABAD: The government has given some sort of relief to current and former government employees, announcing a seven percent increase in salaries and pensions in the budget for 2026-2027, ARY News reported.

Salaries and Pensions

Addressing the National Assembly on the occasion of presenting the budget for the next financial year, Federal Minister for Finance Muhammad Aurangzeb announced that the government is increasing the salaries of government employees by seven percent, while the same percentage will be raised for retired employees’ pensions.

Minimum Wage

On the other hand, the government has also announced an uptick in the minimum wage for labor by 10 percent in the next year’s budget.

Rs 3000 to Rs 4000 increased

The government has raised the minimum wage by Rs 3,000, bringing it to Rs 40,000. (Note: Assuming the original “Rs 3000 to Rs 4000” meant a 10% raise on Pakistan’s previous minimum wage of Rs 37,000, making the new wage Rs 40,000).

The finance minister started his speech by paying tribute to the armed forces of Pakistan, who defeated a much larger enemy in May 2025 and the civil and military leadership’s efforts, which took Pakistan to an elevated status in international diplomacy during the ongoing Iran war where both the US and Iran showed their trust in Pakistan’s mediation efforts.

He maintained that the closure of the Strait of Hormuz and the subsequent rise in oil prices affected Pakistan’s economy like all other countries, but the country’s government did not pass the burden directly to the people. Aurangzeb promised that the government will bring down petroleum product prices once the oil price drops in the international market.