The Ministry of Finance has issued a new office memorandum revising the eligibility criteria for the health allowance granted to federal government employees, restricting it to those directly involved in patient care. This revision follows a recent Supreme Court ruling in the case of Civil Appeals No. 302-315 of 2024 (Federation of Pakistan vs Ehsan ul Haq), which clarified the scope of “delivering health services,” Business Recorder reported.
The Supreme Court’s judgment emphasized that individuals not directly involved in patient care would no longer qualify for the allowance.
According to the memorandum, employees who directly provide clinical care to patients, such as doctors, allied health specialists, nurses, paramedics, and pharmacists, will remain eligible for the allowance.
The revised policy also includes several conditions: the health allowance will be taxable and payable during leave and the period of leave preparatory to retirement, but it will not be considered in pension, gratuity, or house rent calculations.
Employees posted or deputed abroad will not receive the allowance, although it will be restored when they return to Pakistan.
The rate of the health allowance will continue to be governed by Finance Division notifications from February 2012 and July 2015. The memorandum instructs the Controller General of Accounts (CGA) to stop payments to those no longer eligible and reassign Disparity Reduction Allowance (DRA) to qualifying employees based on previous Finance Division guidelines.
Ministries and departments have been directed to ensure strict implementation of these changes and report compliance within 15 days. The Finance Division also withdrew a prior memorandum issued on December 2, 2025, due to a technical error in the system.
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