Understanding Pakistan’s New Health Allowance Rules for Medical Staff

The federal government has rolled out a new framework for health allowance payments, reshaping how medical staff across Pakistan will receive this benefit. The rules, approved by the Prime Minister, are designed to ensure that only those directly engaged in patient care qualify.

According to the Ministry of Finance memorandum, eligibility is restricted to doctors (medical and dental), allied specialists, pharmacists, nurses, paramedics, and supporting staff who provide hands‑on treatment and care. Employees who are not involved in direct patient services—such as administrative or non‑clinical staff—will no longer be entitled to this allowance.

The decision follows a Supreme Court ruling from July 2024, which clarified what constitutes healthcare service delivery. The court defined direct services as patient reception, treatment, care, and addressing medical issues. This legal interpretation now forms the backbone of the government’s updated policy.

The allowance will be subject to income tax, ensuring transparency and accountability. It will remain payable during regular leave and leave prior to retirement (LPR), but not during extraordinary leave. Importantly, the benefit will not count toward pension, gratuity, or house rent deductions.

To streamline implementation, all accounts offices have been instructed to finalize the process within 15 days and submit compliance reports. This move signals the government’s intent to enforce stricter financial discipline while rewarding healthcare professionals who are actively serving patients.

By narrowing eligibility, the government aims to align benefits with actual service delivery, ensuring that frontline medical staff receive recognition and support. The new rules highlight a broader push toward accountability and efficiency in Pakistan’s healthcare system.