The Finance Ministry is reviewing proposals to raise government employee salaries by seven percent and increase pension payments by five percent in the upcoming budget 2026-27.
Proposals Under Review
No final decision has been announced by the federal government, as the Finance Ministry continues evaluating different budget proposals ahead of the 2026-27 fiscal year announcement.
Rising inflation, higher electricity and gas bills, and increased daily living costs have prompted the government to consider providing financial relief to salaried government employees.
Additional benefits beyond the salary increase are also being considered in the budget proposals, specifically targeting low-income government employees facing growing financial pressure.
Recommendations from various government departments may also be sought to help identify practical and feasible measures that could be included in the final budget document.
Economic Considerations
Economists say that if approved, the salary and pension increase would benefit thousands of government employees and retirees across the country throughout the upcoming fiscal year.
However, economists note the final decision will depend on the financial capacity of the government, its revenue targets, and the overall budget strategy for 2026-27.
Balancing public financial relief against the need to control the fiscal deficit remains one of the most significant challenges facing the government during this budget cycle.
Final Decision Pending
It is worth noting that the government will make its final decision on salary and pension increases at the time of formally approving the complete budget documents next month.
The 2026-27 budget is being prepared with the stated aims of delivering public relief, maintaining economic stability, and achieving a sustainable balance in overall government expenditure.
