THE country’s pension bill till recently of retired government employees stood at Rs13 trillion per annum. With the condition of economy being what it is, a hybrid system of pension needs to be introduced in Pakistan.

The salaries of employees should be increased to, say, Rs200,000 for those in BPS-17 with the provision that those who want to get pension after retirement will have to relinquish one-fifth of their salaries. This portion of their salaries will be paid to them after retirement every month, and it will be paid to them, or their families, for a duration not exceeding their length of service.

A cumulative account of every employee should be maintained through which the amount deducted for pension benefits can be ascertained, as the amount deducted will vary throughout the service period.

At the time of retirement, the total amount should be divided into total months in order to get the amount to be paid every month. It will not only reduce burden on the exchequer, but also give the employees a chance to make their own choice. It will also reduce future cost of the pension bill.

Muhammad Mohtasim Bosal
Mandi Bahauddin

Published in Dawn, June 15th, 2023