The Khyber Pakhtunkhwa (KP) government has developed a set ofrecommendations aimed at addressing a severe financial crisis and avertingdefault. One of the proposals under consideration is a substantialreduction of 25% in government employee salaries.
To assess the dire financial situation and explore potential solutions, ahigh-level meeting took place at the KP Finance Department. During thismeeting, various recommendations were discussed, with a primary focus onmitigating the province’s financial crisis. The sources suggest that theseproposals will soon be presented to the caretaker chief minister forapproval.
Among the options discussed in the meeting is the possibility of rollingback the 35% salary increase that government employees received in thecurrent fiscal year. This rollback could result in monthly savings ofapproximately Rs9 billion for the province. Additionally, there isconsideration of a 25% reduction in government employee salaries, which hasthe potential to save around Rs8 billion each month.
The provincial government finds itself in a challenging situation due tothe ongoing financial crisis. As a result, they are actively exploringmeasures to reduce salaries in order to alleviate the situation.
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Another option on the table involves discontinuing executive allowances,health professional allowances, and similar perks for government employees,which could lead to monthly savings of about Rs2 billion.