Islamabad, The Securities and Exchange Commission of Pakistan (SECP) has released a comprehensive White Paper to guide the country’s transition from a Defined Benefit (DB) pension model to a Defined Contribution (DC) system on July 16, 2025. The release follows a national workshop held on June 17, 2025, which brought together senior officials from federal and provincial governments, the pension and insurance sectors, and global development partners.
The SECP aims to implement the DC pension model under its Voluntary Pension System (VPS) framework. This transition is crucial to replace Pakistan’s unsustainable DB scheme with a transparent, inclusive, and financially viable system.
Khyber Pakhtunkhwa took the lead in July 2022 by enrolling all new employees in a DC pension plan. The scheme mandates a 10% employee contribution and a 12% employer contribution. Punjab has also notified similar DC pension rules. Other provinces are currently preparing their frameworks.
The national workshop served as a key milestone, offering a platform for stakeholders to share experiences and align reform strategies. The newly released White Paper consolidates insights from the event, outlines the progress made, and suggests practical steps for nationwide implementation.
Policy recommendations include finalizing the national pension scheme framework, introducing consistent tax policies, updating labor laws, and raising employee awareness. The document also emphasizes the need for institutional coordination for a smooth and equitable reform process.
The SECP’s White Paper is expected to serve as a reference for stakeholders and policymakers working to build a sustainable pension system across Pakistan.
