Pakistan’s government has approved Rs4.4 billion to settle pending medical and pension payments for retired employees of Pakistan International Airlines (PIA), even as the national carrier moves through its post-privatisation phase.
The decision was taken during a meeting of the Economic Coordination Committee (ECC), chaired by Finance Minister Muhammad Aurangzeb, following a request from the Ministry of Defence to address financial obligations linked to PIA’s restructuring.
Originally, authorities sought around Rs6 billion to support PIA Holding Company Limited in managing the airline’s liabilities. However, the ECC approved a portion of this amount, specifically allocating Rs4.4 billion to cover retirees’ medical expenses and pension payments, along with some salary-related disbursements.
In a related move, the committee also sanctioned Rs455 million to pay employees of the Precision Engineering Complex, which has been separated from PIA and placed under the Ministry of Defence.
However, not all funding requests were approved. A separate proposal seeking Rs1.1 billion for payments to the National Insurance Company Limited (NICL) was rejected, with officials directing that the matter be resolved through the appropriate revenue authorities in line with audit recommendations.
The funding decision comes in the wake of the government’s sale of a 75% stake in PIA for Rs135 billion. Under the terms of the agreement, the airline must maintain positive equity—something that remains difficult without continued financial backing from the state.
The move highlights the government’s ongoing financial support for the struggling national carrier, particularly in ensuring that retired employees receive their due benefits despite broader restructuring efforts.