Dhaka: The government has introduced a special financial incentive for public sector employees and pensioners to elevate their earnings in tackling daily expenses which is going to be effective from July 1.
According to Bangladesh Sangbad Sangstha, the finance division today issued a gazette notification stating that employees in Grades 1 to 9 will experience an annual salary increase of 10 percent of their basic pay, effective from July 1 each year starting this year. Employees in Grades 10 to 20 will receive a 15 percent increase in their salaries. The special incentive amount is set to be a minimum of Tk 1,000 for employees and Tk 500 for pensioners.
The announcement follows the unveiling of a Tk 789,999 crore proposed budget for the 2025-2026 fiscal year by Finance Adviser Dr. Salehuddin Ahmed. The notification clarified that the special allowance is introduced under the authority of Section 15 of the Public Service Act, 2018. This allowance will benefit government-civilian employees under the National Pay Scale, as well as those employed in autonomous and state-owned institutions, banks, insurance and financial institutions, Border Guard Bangladesh, and the police force, including reinstated pensioners and other pension recipients.
The incentive will be provided at a rate of 10 percent for those in pay grades 1 to 9 and at 15 percent for those in grades 10 to 20. Employees on Post-Retirement Leave (PRL) will receive the allowance based on their last drawn basic salary prior to entering PRL. Reinstated pensioners and other pension recipients will receive the allowance based on the existing portion of their pension according to their respective grades.
Retired employees who have withdrawn their entire gross pension and received a lump-sum gratuity, and are not yet eligible for pension restoration, will not qualify for this special allowance. For government employees appointed on a contractual basis under any designated national pay scale grade, the allowance will be calculated on the last drawn basic salary before the contractual appointment.
Employees who are also pensioners and appointed on a contractual basis can choose to receive the allowance on either the existing portion of their pension or the last drawn basic salary before their contractual appointment, but not both. Temporarily suspended employees will receive the special allowance on 50 percent of their last drawn basic salary prior to the suspension, while employees on leave without pay will not be eligible.
Additionally, for employees of autonomous bodies, state-owned enterprises, banks, insurance companies, and financial institutions under the National Pay Scale 2015, except those operated solely on government revenue budget grants, the cost of the special allowance must come from the respective institution’s budget.