ISLAMABAD, July 16 (Xinhua) -- Pakistan's federal cabinet has approved a 15 percent increase in pensions for beneficiaries of the Employees' Old-Age Benefits Institution (EOBI), according to an official statement issued on Wednesday.

The decision was made during a cabinet meeting chaired by Prime Minister Shehbaz Sharif. The increase, effective from Jan. 1, 2025, will be financed through EOBI's own resources, the statement said.

The cabinet also approved the formation of a committee to propose institutional reforms within EOBI and explore options to extend pension coverage to informal sector workers, including domestic helpers and agricultural laborers.

Established in 1976, the EOBI is Pakistan's state-run pension scheme for private sector employees. It provides retirement pensions, survivors' benefits, and invalidity coverage to millions of registered workers.

Funded through mandatory contributions from employers and employees, EOBI plays a central role in the country's social protection system. However, a large portion of the labor force, particularly those in informal employment, remains outside its scope, prompting ongoing efforts to expand coverage and strengthen the institution's sustainability. ■