ISLAMABAD, Jun 18 (Alliance News): Minister for Finance and Revenue, Senator Muhammad Aurangzeb on Tuesday reaffirmed the government’s commitment to structural reforms aimed at achieving sustainable economic growth and long-term stability.
Addressing the “National Workshop on Transitioning to Defined Contribution Pension Schemes,” organized by the Securities and Exchange Commission of Pakistan (SECP), the finance minister emphasized the government’s focus on reforms in taxation, energy, and state-owned enterprises (SOEs).
He highlighted a key reform introduced this year—adjusting Pakistan’s tariff structure—to make the economy more competitive by gradually eliminating protectionist barriers that have restricted industrial growth.
“These reforms will help domestic industries progress and boost the export sector’s global competitiveness,” he stated.
Senator Aurangzeb said the government has undertaken several fiscal measures to address public finance challenges, especially reducing debt servicing.
This includes managing liabilities more effectively to create fiscal space for essential development sectors.
Discussing pension reform, he noted a major policy shift from defined benefit to defined contribution pension schemes for all new federal government employees, effective July 1, 2024.
“This is an essential move to address the growing burden of unfunded liabilities. Our pension bill has already crossed one trillion rupees this year,” he said.
He added that this shift would ensure predictability in government finances, promote fiscal sustainability, and empower employees to manage their own retirement savings.
The finance minister also highlighted provisions in the FY 2025-26 federal budget, including a 7% increase in pensions to protect against inflation and a proposed 5% tax on annual pension income exceeding Rs10 million.
“This is a balanced and equitable measure,” he said, adding that experiences from provincial governments would help develop a uniform national strategy.
Commenting on current geopolitical tensions, Senator Aurangzeb said a high-level meeting was held to evaluate regional developments and prepare risk management strategies.
“We are focused on maintaining strategic reserves and staying ahead of asset pricing trends to ensure economic resilience,” he said.
On ongoing trade talks, the finance minister noted positive developments in negotiations with the United States on tariff adjustments.
“Discussions with the US Secretary of Commerce have been constructive. We are moving in the right direction to strengthen Pakistan’s competitiveness and expand our strategic partnership with the US,” he added.
