Govt proposes 15% special pay allowance for armed forces

Ministry of Finance moves summary for consideration of cabinet

ISLAMABAD:

The government has proposed 15% further increase in salaries for all the ranks of the armed forces aimed at compensating minimal or no increase in their salaries during past two years and ending disparities in pay structures.

The Ministry of Finance has moved the summary for the consideration of the federal cabinet, which is based on recommendation by the Pay and Pension Commission, according to a senior official of the ministry.

Prime Minister Imran Khan has directed to place the summary in the next cabinet meeting, according to a summary that the federal cabinet will take up on Tuesday. The finance ministry has proposed "grant of special allowance 2021 at the rate of 15% of the running basic pay to all the ranks of the armed forces with effect from 1-07-2021". "The total (financial) impact would be Rs38 billion per annum," according to the finance ministry. The government has already budgeted the amount.

This will bring the total increase in the salaries of the armed forces to 25% after including 10% ad-hoc allowance that Finance Minister Shaukat Tarin had announced in his budget speech for civilian and armed forces employees. The Ministry of Finance has also separately notified 10% ad-hoc allowance for the civil employees.

In addition to 10% ad-hoc allowance, the federal government has also given 25% disparity reduction allowance to the civilian employees of the Pak Secretariat, bringing their total additional monetary benefits to 35% in the new budget. The civil Secretariat employees had protested discrepancies in the salaries of various government departments.

Now the salaries of the armed forces are proposed to be increased to 25%, subject to the approval of the federal cabinet.

The finance ministry stated that due to delay in receiving interim report, the federal cabinet had approved relief measures on June 11 wherein armed forces personnel along with civilian employees have been allowed an ad-hoc relief allowance of 10% of the basic pay.

"The Pay and Pension Commission chairperson has now forwarded recommendations for interim relief for the armed personnel till finalisation of recommendations in order to keep the morale of the armed forces high," stated the finance ministry.

It wrote in the summary that the ministry had sought permission of the prime minister to increase the armed forces salaries by further 15% who has directed to bring the matter before the federal cabinet.

Special Assistant to Prime Minister on Finance Dr Waqar Masood Khan did not comment. A federal minister said that the government would give a statement after the cabinet meeting.

For fiscal year 2019-20, the federal government had not given any increase in salaries to the armed forces and the civilian employees. A year earlier, the 10 to 15% increase had been given only up to grade 19 employees, leaving rest of the employees high and dry.

The sources said that this has created resentment in the ranks and files and the civilian and military employees were expected a minimum 20% increase in salaries in the budget speech. In its interim recommendation, the Pay and Pension Commission had also recommended 15% to 20% increase in salaries of both the civilian and armed forces.

The finance ministry has notified the 10% increase in salaries in the form of ad hoc relief which will be subjected to income tax while the allowance will be admissible during leaves. It also read that the ad hoc relief will not be part of the basic salary for commutation and increments.

Bringing civil service reforms was part of the government's agenda but things are moving at a snail's pace. The government hired an actuary firm in May this year to review the salaries' structure that will need at least six months to complete the assignment. It is unlikely that the commission will give its final report by December this year.

Published in The Express Tribune, July 10^th, 2021.

Like Business on Facebook, follow @TribuneBiz on Twitter to stay informed and join in the conversation.