ISLAMABAD: The Pakistan Institute of Development Economics (PIDE) on Wednesday recommended that the government increase the minimum monthly wage or salary in the budget for the new fiscal year 2026-27.
According to sources, the PIDE proposed that the government increase the minimum monthly wage from Rs 40,000 to Rs 45,000 for the fiscal year 2026-27, which is equivalent to an increase of 12.5% over the current minimum wage.
The institute, while proposing a transparent and scientifically based system for determining the minimum wage, said that wages are directly related to poverty and prevailing inflation, and the people’s affordability.
According to the PIDE recommendations, the lowest monthly wage in Sindh was proposed to be fixed at Rs 46,000, in Punjab and Khyber Pakhtunkhwa at Rs 45,000, and in Balochistan at Rs 45,500.
It has recommended ensuring the implementation of the minimum wage in a phased manner, saying that the implementation of the minimum wage should be made mandatory in government contracts and outsourced services.
The organisation said the implementation of the minimum wage law is a major challenge as more than 80 per cent of employment in Pakistan is in the informal sector.
It also suggested that all provinces issue annual reports on the implementation of the minimum wage; hence, monitoring and effective evaluation of the system can be possible.
According to the report, the proposed framework has been sent to the Planning Commission for consideration.
PIDE says that the minimum wage system should not be limited to a mere annual announcement but must be linked to an effective governance, monitoring and implementation system.
