The country's 40 million government and public institution staff will not face income cuts after pension reform, a senior official has said, amid mounting concern of a decrease in disposable income among such staff members.

The central government unveiled a new pension system for government and public institution employees on Jan 14 under which they must contribute to their pensions in conjunction with their employers.

Civil servants and public institution employees will have to pay 8 percent of their deductible salary toward their pensions, triggering concerns that the reform might lower their disposable income.