The federal government is reportedly considering a proposal to reduce the retirement age for government employees by five years so it will ease the growing pension burden on the national budget.
The idea to lower the retirement age from 60 to 55 years was suggested by the International Monetary Fund (IMF) and is currently under review. Officials are assessing its financial and legal implications before making a decision.
Sources indicate that this step is being examined as a way to tackle rising pension costs, which have reached alarming levels. If applied across all government institutions, it could potentially save up to Rs 50 billion each year.
At present, government employees qualify for a pension based on their final basic salary at the age of 60. This has pushed annual pension expenses to over Rs 1 trillion. While a contributory pension scheme has already been introduced for new employees, experts believe more drastic measures are needed to control these escalating costs.
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