In budget 2026-27 government employees got a 7% Ad hoc Relief Allowance 2026 on the new basic pay. At the same time the 2022 and 2025 relief allowances were merged into basic pay, creating Basic Pay Scales 2026 from 1 July 2026. Federal, Punjab, Sindh and KP employees have all moved to the new scales. Pensions went up 7%, except in Punjab, where the rise was 3.5%.
Enter your scale and your basic pay from the June 2026 pay slip. The calculator finds your stage in BPS-2022, moves you to the same stage in BPS-2026 and adds the 7% allowance. Add the two old allowances from your slip to see the exact change in take-home basic pay.
Budget 2026-27 salary and pension increase by government
The 2026-27 salary rise is the 7% allowance on BPS-2026 basic pay. Last year's figures are shown for comparison.
| Government | Salary 2026-27 | Pension 2026-27 | Salary 2025-26 | Pension 2025-26 | Status |
|---|---|---|---|---|---|
| Federal | 7% | 7% | 10% | 7% | Notified |
| Punjab | 7% | 3.5% | 10% | 5% | Notified |
| Sindh | 7% | 7% | 12% (BPS 1 to 16), 10% (BPS 17 to 22) | 8% | Notified |
| Khyber Pakhtunkhwa | 7% | 7% | 10% | 7% | Notified |
| Balochistan | 7% | 7% | 10% | 7% | Announced in budget |
In 2025-26 federal staff who were already getting it also received the Disparity Reduction Allowance at 30% of basic pay as on 30 June 2022. Balochistan's 7% was announced in the budget speech; we have not seen its pay scale notification.
How the new pay is worked out
The Finance Division order of 21 July 2026 does three things from 1 July 2026:
- Merges two allowances into basic pay. ARA-2022 (15% of BPS-2017 basic pay) and ARA-2025 (10% of BPS-2022 basic pay) stop, and new scales, BPS-2026, take their place.
- Fixes pay point to point. You keep the same stage, that is the same number of increments above the minimum. If you were at the minimum plus 6 increments in BPS-2022, you are at the minimum plus 6 increments in BPS-2026.
- Adds ARA-2026 at 7% of the running basic pay of BPS-2026. It is taxable, and it does not count for pension.
Special pays and allowances paid as a percentage of pay are frozen at their 30 June 2026 level. Annual increments continue on 1 December. Employees could opt to stay in BPS-2022 within 30 days.
Worked example: BPS-16
A federal employee in BPS-16 drew a basic pay of Rs 41,630 in June 2026.
- Stage in BPS-2022: (41,630 minus 28,070) / 2,260 = 6 increments above the minimum.
- Same stage in BPS-2026: 33,720 + 6 x 2,720 = Rs 50,040.
- The Rs 8,410 rise in basic pay replaces the ARA-2022 and ARA-2025 that stopped. Of it, ARA-2025 was 10% of Rs 41,630 = Rs 4,163.
- ARA-2026: 7% of Rs 50,040 = Rs 3,503 a month. This is the new allowance. The total gain is a little more if the new basic pay is higher than the old basic pay plus the two merged allowances; enter those allowances from your slip to see the exact figure.
- From 1 December 2026, one increment of Rs 2,720 lifts basic pay to Rs 52,760 and the allowance to Rs 3,693.
Last year's raise at the same pay was ARA-2025 of 10%, which was Rs 4,163. Income tax comes off the higher gross; see the salary tax calculator.
Basic Pay Scales 2026 chart
Minimum, annual increment and maximum of each scale in BPS-2026, with the BPS-2022 minimum for comparison. Scales 1 to 16 have 30 increments, 17 to 19 have 20, and 20 to 22 have 14.
| Scale | Minimum BPS-2022 | Minimum BPS-2026 | Increment | Maximum | ARA-2026 at minimum (7%) |
|---|---|---|---|---|---|
| BPS-1 | 13,550 | 16,280 | 520 | 31,880 | 1,140 |
| BPS-2 | 13,820 | 16,600 | 590 | 34,300 | 1,162 |
| BPS-3 | 14,260 | 17,130 | 700 | 38,130 | 1,199 |
| BPS-4 | 14,690 | 17,650 | 800 | 41,650 | 1,236 |
| BPS-5 | 15,230 | 18,300 | 910 | 45,600 | 1,281 |
| BPS-6 | 15,760 | 18,930 | 1,010 | 49,230 | 1,325 |
| BPS-7 | 16,310 | 19,590 | 1,100 | 52,590 | 1,371 |
| BPS-8 | 16,890 | 20,290 | 1,210 | 56,590 | 1,420 |
| BPS-9 | 17,470 | 20,990 | 1,310 | 60,290 | 1,469 |
| BPS-10 | 18,050 | 21,680 | 1,430 | 64,580 | 1,518 |
| BPS-11 | 18,650 | 22,410 | 1,580 | 69,810 | 1,569 |
| BPS-12 | 19,770 | 23,750 | 1,720 | 75,350 | 1,663 |
| BPS-13 | 21,160 | 25,420 | 1,880 | 81,820 | 1,779 |
| BPS-14 | 22,530 | 27,060 | 2,090 | 89,760 | 1,894 |
| BPS-15 | 23,920 | 28,730 | 2,380 | 100,130 | 2,011 |
| BPS-16 | 28,070 | 33,720 | 2,720 | 115,320 | 2,360 |
| BPS-17 | 45,070 | 54,140 | 4,110 | 136,340 | 3,790 |
| BPS-18 | 56,880 | 68,330 | 5,120 | 170,730 | 4,783 |
| BPS-19 | 87,840 | 105,510 | 5,450 | 214,510 | 7,386 |
| BPS-20 | 102,470 | 123,090 | 8,040 | 235,650 | 8,616 |
| BPS-21 | 113,790 | 136,680 | 8,920 | 261,560 | 9,568 |
| BPS-22 | 122,190 | 146,770 | 10,470 | 293,350 | 10,274 |
Pension increase 2026-27
Choose Pensioner in the calculator. Federal pensions went up by 7% of the baseline pension from 1 July 2026. Punjab gave 3.5% of the net pension, excluding medical allowance, to those who retired before 1 July 2026. Sindh, KP and Balochistan gave 7%. Federal increases are worked on the baseline pension, which can differ from the pension you draw, so check the figure with your bank or AG office. To work out a new pension from scratch, use the pension calculator.
Private sector: a plain salary increment
Choose Any salary, by % for a private job. A 10% increment on Rs 100,000 a month is Rs 10,000, making the new salary Rs 110,000 and adding Rs 120,000 a year. To see what an increment means after tax, run both salaries through the salary tax calculator.
Salary increase questions
How much is the salary increase in budget 2026-27?
7% for federal, Punjab, Sindh, KP and Balochistan employees, paid as the Ad hoc Relief Allowance 2026 on the new BPS-2026 basic pay from 1 July 2026. At the same time ARA-2022 and ARA-2025 were merged into basic pay, which is why the new basic pay looks about 20% higher.
Why has my basic pay gone up by about 20%?
Because the old ARA-2022 and ARA-2025 are now inside it. Before July 2026 they were paid as separate allowances. Your pay from those three items stays the same or rises slightly, and the main new money is the 7% ARA-2026 on top.
Is ARA-2026 counted for pension or house rent?
No. The Finance Division order says ARA-2026 is not part of emoluments for pension. It is taxable. The merged allowances, now inside BPS-2026 basic pay, do count for pension because they are part of basic pay.
What is the Punjab salary increase for 2026-27?
Punjab moved to BPS-2026 and gives ARA-2026 at 7% of the new basic pay from 1 July 2026, the same as the federal government. Its pension increase is 3.5% of net pension for those who retired before 1 July 2026.
When is the next annual increment?
On 1 December 2026, at the BPS-2026 increment rate of your scale, for example Rs 2,720 in BPS-16. Tick the box in the calculator to add it. The 7% allowance rises with it because it is a percentage of running basic pay.
Related tools
Last reviewed 30 September 2026. Results are estimates; official notices always take precedence.