The Punjab government has introduced a new ordinance that will overhaul its recruitment process by shifting from the basic pay scale system to lump sum pay packages, effectively eliminating pensions for future employees.
According to a news report published by Dawn, the Punjab Regularisation of Service (Repeal) Ordinance 2025, which was promulgated on October 31, repeals the Punjab Regularisation of Service Act 2018, aiming to reduce the government’s financial liabilities, particularly pension costs.
The ordinance, tabled in the Punjab Assembly on Monday, aims to address the fiscal burden on the provincial exchequer by introducing a new model for appointing employees. The move will end the regularisation of services for contractual employees after four years, a provision previously allowed under the 2018 law.
The new system stipulates that departmental recruitments will be conducted on a lump sum pay package, and employees appointed on contract will remain in that status for the duration of their service, without entitlement to pensions. This change is designed to alleviate the financial strain caused by pension obligations in the public sector.
The Punjab Regularisation of Service Act 2018 had previously allowed contract employees to be considered for permanent positions after four years of service, provided they met certain qualifications and performance criteria. It also included provisions for the regularisation of services and a framework for appointments, pay, and seniority.
While the new ordinance has been enacted, confusion remains about its impact on employees hired before its promulgation.
In light of the changes, some civil servants are calling for either regular job options or more competitive salaries to strengthen the government’s workforce, suggesting that such measures would improve the quality of public service.
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