Partial rollout of new pay scale likely from Jan

The new pay structure for government employees is likely to be partially implemented during the interim government’s tenure, effective from January.

Subsequently, an additional allocation of about Tk 20,000 crore has been kept in the revised budget to cover salaries and allowances of more than 15 lakh government officials and employees.

The announcement of the implementation of the new pay structure is likely to be made ahead of the national election on February 12 once the National Pay Commission’s report is scrutinised, a senior finance ministry official told The Daily Star. The National Pay Commission’s report is expected by January 21.

Either the revised basic salary or the allowances could be implemented from January, so the allocation made in the revised budget would be sufficient.

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The new pay structure would provide a higher increase to those at the lower grades, the official added.

Meanwhile, the government has finalised the revised budget, which will come into effect on February 1. 

The overall budget size has been reduced by Tk 2,000 crore to Tk 788,000 crore.

While the development budget has been slashed by Tk 30,000 crore, the non-development budget has been increased by Tk 28,000 crore -- mainly for the implementation of the new pay structure.

In the original budget for this fiscal year, Tk 84,114 crore was allocated for salaries and allowances. In the revised budget, the allocation is set to exceed Tk 100,000 crore. 

At present, the number of government officials and employees stands at about 15 lakh.

In addition, the new pay structure will also apply to employees of various autonomous bodies and state-owned banks, although their salaries are not paid directly from the government budget.

The National Pay Commission may recommend a separate pay scale for the Bangladesh Bank and state-owned banks, distinct from the government pay structure. The move is aimed at making state-owned banks more competitive with the private sector by allowing greater flexibility in compensation.

Separate pay structures are also expected for the judiciary and the armed forces, officials said. 

The government formed the Ninth Pay Commission in July last year with former finance secretary Zakir Ahmed Khan as its chairman. The commission was asked to submit its report within six months.

The last national pay scale was implemented in 2015, meaning nearly a decade has passed since the most recent revision.

The commission is considering the cumulative impact of inflation over the past decade while making its recommendations, The Daily Star has learnt from people involved with the proceedings.

The aim is to ensure the real wages under the new structure do not fall below the 2015 level.

At the same time, the government has advised the commission to frame its recommendations in line with the country’s revenue collection capacity and the prevailing cost-of-living pressure.

The 2015 pay scale was implemented in two phases: the revised basic salary took effect from July 1, 2015, while revised allowances came into force a year later.

In fiscal 2014-15, the allocation for salaries and allowances stood at Tk 28,709 crore. Following the implementation of the new pay scale and allowances, the allocation rose sharply to Tk 50,775 crore the following year.

This fiscal year, Tk 35,657 crore has been earmarked for pensions and gratuities for retired government employees.