ISLAMABAD: The Pakistan Railways has informed the National Assembly’s Standing Committee on Parliamentary Affairs that it was facing substantial and rapidly growing pension liabilities that have grown significantly higher than operational revenues. Despite these challenges, the operating performance of Pakistan Railways achieved an operating surplus of Rs2.417 billion in FY2024-25.
A meeting of the Standing Committee on Parliamentary Affairs was held under the chairmanship of its Chairman Rana Iradat Sharif Khan here at the Parliament House on Wednesday. The committee recommended devising a model to ensure railways’ long-term financial viability while safeguarding the welfare and entitlements of all concerned pensioners. It also recommended developing a sustainable model for providing relief to pensioners, including all beneficiaries covered under the prime minister’s package.
The Member Finance (Railways) briefed the committee that Pakistan Railways is the only government department that pays pensions to its retired employees from its own resources. However, the pension expenditure has grown at a rate significantly higher than operational revenues, placing persistent pressure on the budget of Pakistan Railways and constraining investment in core railway operations. Against this backdrop, Pakistan Railways has been undertaking operational and financial reforms aimed at improving revenue generation, controlling expenditures and reducing dependence on government support.
The PR has demonstrated a gradual but sustained improvement in its financial and operating performance, as the operating performance of Pakistan Railways shows a significant turnaround. Revenue increased from Rs48.649 billion in FY2020-21 to Rs93.601 billion in FY2024-25, while operating losses of Rs8.196 billion in FY2020-21 and Rs8.460 billion in FY2022-23 were reversed to an operating surplus of Rs0.412 billion in FY2023-24, which further improved to Rs2.417 billion in FY2024-25. This improvement reflects enhanced operational efficiency and expenditure control. The additional secretary (Finance) briefed the committee that, despite fiscal constraints, considerable budgetary allocation has been consistently provided to Pakistan Railways, which amounts to Rs70 billion in the current fiscal year.
The annual pension expense of Pakistan Railways is lower than the grant provided by the government during the preceding years and that, during 2022-23 and 2023-24, an additional grant of Rs2.5 billion and Rs2 billion respectively was also arranged by the Finance Division to help Pakistan Railways clear its pension backlog.
The committee recommended the development of a sustainable model for providing relief to pensioners, including all beneficiaries covered under the prime minister’s package. Such a model should ensure long-term financial viability while safeguarding the welfare and entitlements of all concerned pensioners.
