Finance Minister Amir Khosru Mahmud Chowdhury on Thursday announced that a new pay scale for government employees will be implemented in phases starting from 1 July, citing the rising cost of living and inflationary pressures.
He made the announcement while presenting the proposed national budget for the fiscal year 2026-27 in parliament.
He said that the government employees have been receiving salaries and allowances under the same pay structure for nearly eleven years.
"During this period, the cost of living has increased significantly due to inflationary pressures. In recognition of this reality, the government is announcing the implementation of a new pay structure for public employees beginning on 1 July 2026," he said.
He said merit, integrity, competence, experience, and professional qualifications will serve as the principal criteria for all appointments, transfers, and promotions across the public service in the government's pursuit of building a "Meritocratic Bangladesh."
The minister expressed firm belief that the ongoing reforms will extend far beyond the simplification of administrative procedures.
"They will contribute to improving the overall business environment, attracting greater domestic and foreign investment, creating new momentum for enterprises of all sizes, strengthening the foundations of production and exports, and expanding employment opportunities across the economy."
He said that an amount of Tk 893.80 billion has been earmarked for salaries and allowances of government officers and employees in the next fiscal year.
The allocation is Tk 46.41 billion, or 5.47 per cent, higher than the revised allocation of Tk 847.39 billion in the outgoing fiscal year, he said.
According to budget documents, the original allocation for government salaries and allowances in fiscal year (FY) 2026 was Tk 841.14 billion, which was later revised upward to Tk 847.39 billion.
The proposed allocation also marks a significant increase from the actual expenditure of Tk 694.23 billion recorded in FY25, indicating a rise of nearly Tk 200 billion in annual spending on government pay and benefits over two years.
Of the total allocation, Tk 138.74 billion has been earmarked for officers' salaries, up from Tk 129.27 billion in the revised budget for FY26, reflecting an increase of Tk 9.47 billion.
For salaries of employees, Tk 306.71 billion has been allocated, compared to Tk 291.70 billion in the revised budget, registering an increase of Tk15.01 billion.
The largest share of the allocation will go to allowances, which have been proposed at Tk 448.35 billion, up from Tk 426.42 billion in the revised budget. The increase in this category alone amounts to Tk 21.93 billion.
According to experts, annual increases in salary and allowance allocations have become necessary due to rising living costs, inflation and the continued recruitment of personnel in public service.
talhabinhabib@yahoo.com
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