Elimination of interest from State Provident Funds

Pakistan's government has shown that it seeks to abolish riba (interest) from the nation's economy. At present, the government's State Provident Funds are kept in interest-bearing debts. The state's Council of Islamic Ideology has decided that changing in increments the mandatory deduction of State Provident Funds from people's salary is not riba. This decision by the council, however, is incorrect, because although the one who ultimately receives payments from the fund (the employee) is not involved in riba, the government clearly is. How can interest can be taken out of the system while employees who keep a part of their salaries with the government can continue to be rewarded for this favor of theirs? There are two ways: a broad scheme may take riba out of savings deposits and short-term loans; or an arrangement may be specific to the relationship between an employee and an employer. The second model might fit situations other than the one the government faces with the State