The finance ministry on Friday issued notifications for a 10 per cent increase in the salaries of federal government employees, as well as granting Disparity Reduction Allowance (DRA) worth 30pc of basic pay, according to documents seen by Dawn.com.

The pay hike was announced as part of the budget for the coming fiscal year, where the salaries of federal employees from Grade 1 to 22 would be raised by 10pc and retired government servants would be eligible for a 7pc pension increase.

According to one of the notifications, dated July 4, basic pay to armed forces personnel, civil armed forces, and civil employees of the federal government are subject to the pay raise.

The notification read that the pay would be “subject to income tax; admissible during leave and entire period of LPR except during extraordinary leave; will not be treated as part of emoluments for the purpose of calculation of pension/gratuity and recovery of house rent.”

It further said that the pay would “not be admissible to the employees during the tenure of their posting/deputation abroad; and will be admissible to the employees on their repatriation from posting/deputation abroad at the rate and amount which would have been admissible to them had they not been posted abroad”.

A separate notification, also dated July 4, read that federal government employees from Grades 1-22 could draw on DRA at 30pc of basic pay. The grant applies to those employees already drawing on DRA.

“For those employees who have been appointed on or after July 1, 2022, this allowance will be admissible on the basis of the relevant initial Basic Pay Scale of 2017,” the notification stated.

Last month, the government approved an over fivefold increase in the salaries of the Senate chairman and National Assembly speaker, taking it to Rs1.3 million a month.

A May 29 notification revealed that the Senate chairman and NA speaker’s salaries have been raised from Rs205,000 to Rs1.3m, besides 50pc of the revised salary (Rs650,000) as the sumptuary allowance.

The hike, with a retrospective effect, was effective in January 2025.

Meanwhile, in May, President Asif Ali Zardari promulgated an ordinance to increase the salaries of federal ministers and ministers of state to match those of National Assembly members (MNAs).

The National Assembly’s Finance Committee, headed by NA Speaker Ayaz Sadiq, approved the proposed increase of the monthly salary of each MNA and senator to Rs519,000. Previously, lawmakers received a monthly salary of Rs180,000.

“The federal ministers and ministers of state shall receive a monthly salary equivalent to the salary of a member of the National Assembly,” read the ordinance.