Islamabad ‘:
The Asian Development Bank (BAD) said that the pension plan for employees of the Pakistani government is “attractive”, but that it places an immense burden for the national chessboard because it has no financing mechanism.
In a report published on Friday, the Manila-based institution also called to bring reforms to the country’s underdeveloped insurance sector to strengthen financial protection against natural disasters and support the growth of the private sector.
The BAD detailed how the generous advantages offered to retired government employees are not supported by a structured financing plan, making the system an important drain on public finances.
The report noted that “the burden of the government pension on the chessboard is very high”.
The report planned to develop the scope of the employee’s benefits institution to create a more sustainable contributory system and stressed the essential role that a robust insurance sector could play in the economic stability of Pakistan.
The report suggests that the government should promote the insurance sector, in particular for social insurance programs targeting the poor.
He also underlined the need to improve the regulatory environment of insurance companies.
