Concessions offered in view of rising cost of living will apply uniformly to employees from grades 1 to 22
The federal government has approved an 85% increase in the rent ceiling for federal employees, according to official sources. The decision was approved by the Federal Cabinet on a summary moved by the Ministry of Housing and Works.
The revised cap will apply uniformly to employees from grade 1 to grade 22, providing relief in the wake of rising living costs. Sources said the increase will benefit hundreds of government employees, although it is expected to impose an estimated additional annual burden of Rs12 billion on the national exchequer.
The move is part of a wider review of public services to adjust compensation in line with inflationary pressures and market housing prices.
Read: Here’s how much advance pay federal employees can take under new rules
Earlier, on Thursday, the Treasury Department unveiled the Federal Government Receipts and Payments Rules 2025, a new policy that entitles federal government employees to a housing advance.
According to an official memo, employees from grades 1 to 16 are classified as ‘staff’, who can now get a home builder’s advance equivalent to 36 months of their basic salary. Officers in grade 17 and above will be entitled to an advance equivalent to 24 months of their basic salary.
The ministry said the payments will be processed under the 2025 rules whenever housing applications are submitted.
The combined revisions to allowances and loan eligibility are intended to ease the financial pressure on government employees at a time of persistent inflation and skyrocketing housing costs.
