ISLAMABAD (Web Desk) – The federal cabinet has approved a new allowance for officers of the All Pakistan Services (APS), with an estimated allocation of Rs1.8 billion from July 1, 2026.
The decision was taken during a special cabinet meeting held on June 12, where the government also approved a 7% salary increase for all government employees and extended austerity measures for the fiscal year 2026-27.
The newly approved allowance, named the “All Pakistan Services (APS) Provincial Governments’ Cadre Posts’ Parity Allowance,” is intended to address differences in compensation structures for officers serving under the All Pakistan Services framework.
The cabinet has directed the Establishment Division, in consultation with the Finance Division and Cabinet Division, to prepare recommendations regarding the allowance structure, eligibility criteria and other relevant details for approval.
The All Pakistan Services framework covers officers who serve in both federal and provincial governments. The Pakistan Administrative Service and Police Service of Pakistan are among the major services included in this category.
Previous executive allowance
The latest decision follows the approval of a 150% executive allowance for certain federal government officers in 2022. The allowance was later extended to other service groups after demands for equal treatment.
The new allowance has brought renewed discussion about the need for broader reforms in government salary structures. Supporters of the decision argue that differences in pay packages between federal and provincial postings can affect officers’ willingness to serve in federal assignments.
Critics, however, have called for a comprehensive and transparent compensation policy covering all government employees instead of introducing separate allowances for specific groups.
Austerity measures continue
During the same cabinet meeting, the government extended austerity measures for the current fiscal year.
The measures include restrictions on purchasing new vehicles, limits on acquiring non-essential durable goods, restrictions on creating new posts and controls on government-funded foreign visits that are not considered necessary.
The cabinet also maintained limits on official events and directed that existing austerity rules would continue to apply to government departments and state-owned entities.
The government, however, allowed the relevant austerity committee to consider exemptions on a case-by-case basis where proper justification is provided.
Debate over public sector reforms
The approval of the new allowance comes amid ongoing discussions about government spending, public sector salaries and fiscal management.
Analysts have stressed that long-term reforms in civil service pay structures could help reduce disparities among different categories of government employees and ensure a more balanced system.
The government will now determine the final structure and implementation mechanism of the allowance after recommendations from the concerned divisions.
