The federal government has issued a notification clarifying the new pension determination procedure, which will come into effect from January 1, 2025.

The changes aim to streamline the pension system and prevent multiple pensions for government employees.

According to the Ministry of Finance, pensions will now be calculated based on the average salary of the last two years of service. Additionally, employees will no longer be eligible to receive dual or multiple pensions simultaneously.

The notification specifies that the ban on double or multiple pensions will take effect from January 1, 2025. However, federal employees who were already receiving dual pensions before this date will not be affected. If such employees take a new job after January 1, they will have to choose between receiving a salary or pension.

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Furthermore, the Ministry of Finance stated that any additional increment received in the final year of service will not be included in pension calculations. In another major change, family pensions will now be determined based on the net pension amount rather than the gross pension.

The new policy will not apply to those who retired before January 1, 2025, or to employees who took leave preparatory to retirement (LPR), encashment, or early retirement.