Proposed Pay Scale Alters Government Allowances Structure

The government’s proposed ninth national pay scale is set to significantly increase the basic salaries of public sector employees while simultaneously reshaping several existing allowances, triggering wide-ranging adjustments across the civil service pay structure.

Under discussions held at a high-level meeting in the Secretariat chaired by Cabinet Secretary Nasimul Gani, policymakers reviewed the draft framework, fiscal implications and possible implementation strategy of the new pay structure. According to officials familiar with the discussions, there is a preliminary plan to introduce the revised pay scale from 1 July, subject to final approval.

While the core objective of the reform is to enhance the take-home income of government employees, the accompanying proposals suggest a recalibration of several allowances to maintain fiscal balance and prevent excessive strain on public expenditure.

One of the most significant areas under review is the house rent allowance. At present, it ranges between 45 and 70 per cent of basic salary depending on location and grade. With the proposed rise in basic pay, maintaining the same percentage would sharply inflate overall government spending. As a result, authorities are considering reducing or standardising the rate at a more sustainable level.

Medical allowance is also under scrutiny. Currently fixed at 1,500 taka per month for all grades, it may be restructured or capped under the new system. Officials argue that a uniform allowance may no longer reflect the revised salary hierarchy and broader budget constraints.

Education assistance for employees with two children is similarly expected to be reviewed, with discussions focusing on introducing a ceiling or revised eligibility criteria.

Transport-related benefits, including fixed travel allowances and fuel and vehicle maintenance facilities for entitled officials, are also part of the reassessment process. Some smaller, less utilised allowances are likely to be abolished entirely if deemed outdated or redundant.

Officials emphasise that the intent is not only fiscal discipline but also administrative modernisation. The Cabinet Secretary noted during the meeting that improving the living standards of government employees must go hand in hand with enhancing transparency, accountability, and service delivery in public administration.

The proposed pay scale is expected to involve a substantial allocation in the upcoming national budget, estimated at around 44,000 crore taka. However, the final structure of allowances will only be confirmed after official approval and subsequent gazette notification.