Double dipping is legal again: retired officials can now pocket salary and pension

ISLAMABAD: The federal govt has allowed retired employees who return to government service to receive their salary and pension simultaneously, overturning earlier restrictions that forced them to choose between the two.

The Ministry of Finance issued a fresh office memorandum on Thursday, withdrawing notifications dated April 22 and June 19, 2025, which had previously limited the benefits of re-employed pensioners, and then eased them a bit. However, the new directive completely abolishes the restrictions. It has also been circulated to all federal ministries and divisions with immediate effect.

Earlier this year, retirees rejoining government jobs after the age of 60 were barred from drawing both a salary and pension at the same time. A partial relaxation in June had allowed pension payments alongside salaries, but only if the salary was reduced by an amount equal to the pension. Both restrictions have now been completely removed.

The previous measures were introduced under pension reform programs linked to IMF and World Bank requirements, aimed at controlling the growing pension liabilities of the national exchequer. The policies had sparked opposition, with retired civil servants and advocacy groups demanding full benefits even upon re-employment.

Government officials said the withdrawal reflects the administration’s recognition of the contributions of retired employees, many of whom return to advisory or contractual roles while continuing to receive pension payments.

The move is expected to affect a substantial number of re-employed retirees, allowing them full financial benefits without deductions, a change likely to be welcomed by those serving in key administrative and advisory capacities.