ISLAMABAD – The federal government on Tuesday notified a 7 percent Adhoc Relief Allowance for federal employees while notifying the Revised Basic Pay Scales (BPS) 2026.

According to the Ministry of Finance, the new pay structure will take effect from July 1, 2026, with the allowance payable on the revised running basic pay.

Under the revised framework, the government has merged the Adhoc Relief Allowances granted in 2022 and 2025 into the new basic pay, permanently restructuring employees’ salaries instead of continuing separate relief payments. Salaries of all existing federal employees will be re-fixed on a point-to-point basis under the Revised Basic Pay Scales 2026. Despite the new pay structure, employees will continue to receive their annual increment on December 1 every year under the existing rules.

50% Increase in Conveyance Allowance for Employees

The federal government has officially approved a 50% increase in conveyance allowance for all federal government employees and officers from Grade 1 to Grade 22.

Alongside the increase in transport allowance, the Finance Ministry also implemented a 7% raise in basic salaries for federal employees from Grade 1 to Grade 22.

Finance Ministry has clarified that the 7% Adhoc Relief Allowance will be taxable under applicable income tax laws. The notification also confirms that the Adhoc Relief Allowances of 2022 and 2025 will cease to exist from July 1, 2026, as they have now been incorporated into the revised pay scales.

Ministry has directed all ministries, divisions and departments to obtain a written and irrevocable option from every employee within 30 days. Employees must choose whether they wish to continue under the Basic Pay Scales 2022 or switch to the Revised Basic Pay Scales 2026.