Govt mulls minimum wage hike, petrol ration card to offset impact of mounting inflation

Ministry of Finance is working on five major proposals for finalising targeted subsidies in view of rising inflation

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— AFP/File
— AFP/File

  • Ministry of Finance is working on five major proposals for finalising targeted subsidies.
  • Proposal include raising minimum wages from Rs20,000-25,000, pushing private firms to jack up salaries by 20-25%.
  • The government is now trying to find different options to dole out targeted subsidies.


ISLAMABAD: In view of mounting inflation, work on five major proposals for finalising targeted subsidies including raising minimum wages from Rs20,000-25,000 and pushing private firms to jack up salaries by 20-25% is underway, The News reported.

Ministry of Finance in consultation with Macro Advisory Group is working on proposals related to increasing salaries for government employees by 25%, provision of petrol ration card for motorcycle riders, the launch of an internship programme for educated youth, and allowing the obtainment of medicines through Sehat Insaf Card for poor segments of the society.

Read more: After Sehat Card, govt plans to launch Ehsaas petrol cards

Well-placed sources told the publication that the ministry has considered different options and asked the official associated with the Ehsaas Programme to share their data for finalising the design of the targeted subsidy.

"There are 23 million motorcycles in the country and the government cannot provide petrol subsidy to all because it will require Rs200 billion," sources said, adding that the government has decided to use Ehsaas data to grant petrol subsidy to those bike riders who fall under the category of very poor.

According to the details, these views came to the fore in background discussions after the Macro Advisory Group Zoom meeting with Federal Minister for Finance and Revenue Shaukat Tarin.

The petroleum product prices might further escalate next month as the recent increase was announced when Brent Crude was at $88 per barrel and now it has already crossed $95 per barrel.

Read more: Why was there a hike in petrol price?

The government is now trying to find different options to dole out targeted subsidies. There are different proposals and the government wants to finalise them as early as possible.

There are three different proposals related to increasing the minimum wages of public and private sectors by increasing them from Rs20,000 to Rs22,000, Rs25,000, and Rs28,000.

It will be decided after the finalisation of the proposal on petrol cards for motorbikes.

Read more: Govt will provide maximum relief to salaried persons, Hammad Azhar says

The Macroeconomic Advisory Group endorsed the government’s efforts being undertaken for dealing with the impact of rising prices on the general population.

There was consensus among members that the new initiatives undertaken by the government were in line with the sustainable macroeconomic stability paradigm.

The group members recognised that global inflationary tendencies had cast undesirable impacts across the globe including Pakistan.

They comprehensively deliberated on various initiatives that could be undertaken for the provision of maximum relief to the public.

These initiatives are specifically aimed at resolving the economic constraints of the middle and lower economic strata of society.