The federal government has initiated a new Contributory Pension Fund Scheme for civil employees. This contains all federal government employees, including those paid from Defense Estimates, who start working on or after July 1, 2024.

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An office notation from the Finance Division, released on Tuesday, also mentioned that this scheme will extend to the Armed Forces but only for those appointed on or after July 1, 2025.

Under the new scheme, employees will contribute 10% of their basic pay, while the federal government will add 20% of the employee’s basic pay. The Finance Division noted that these contribution rates are temporary and may change.

This new pension scheme follows the Economic Coordination Committee’s (ECC) approval in June for setting up a Pension Fund. The Government Pension Scheme desires to improve retirement planning for government employees.

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