The federal government is reportedly thinking about lowering the retirement age for government employees from 60 to 55 years. This proposal is being discussed to tackle the rising pension costs, which are putting immense pressure on the national exchequer.
According to insiders, the idea was suggested by the International Monetary Fund (IMF) as part of broader financial reforms. However, it’s still under review as officials weigh its potential legal and financial impacts. If the government decides to go ahead, this change could save an estimated Rs. 50 billion every year.
Right now, government employees retire at 60 and receive pensions based on their last basic salary. These pensions have become a huge financial challenge, crossing Rs. 1 trillion annually. While the government has already introduced a contributory pension system for new hires, experts believe more drastic measures are needed to control the growing burden.
This proposed reduction in retirement age, if applied across all institutions, could provide immediate relief to the country’s strained finances. But there are concerns about its social impact, as employees retiring earlier might face challenges transitioning to life without a regular income.
For now, this idea remains a proposal, with no official announcement made. The debate over balancing financial sustainability and employee welfare continues, as the government considers the best path forward.
