The government yesterday approved the largest pay hike for civil service since independence, doubling the basic salary of top officials and raising the lowest pay by a record 142 percent.

The National Pay Scale 2026, endorsed at a cabinet meeting chaired by Prime Minister Tarique Rahman, is the first salary revision under the new administration.

The last national pay scale was introduced in 2015, marking the highest hike before now, with basic pay rising by 95 percent in the top grade and 101 percent in the lowest.

The new structure, to be implemented in four phases between July 1, 2026, and January 1, 2028, will cover 24 lakh civilian and military employees, along with 9.25 lakh retirees and other eligible recipients. The government estimates the phased rollout will require an additional Tk 1,05,580 crore annually.

A cabinet division statement said the pay hike aims to strengthen financial security, boost motivation, and build a more efficient and people‑friendly administration.

The National Pay Scale 2026 and, in alignment with it, the Joint Services Instructions 2026 for the armed forces were approved at the cabinet meeting.

A separate committee has been formed for the judicial service. Based on that committee’s report, the Bangladesh Judicial Service Pay Scale will be approved and will take retrospective effect from July 1, 2026, with phased implementation in the same manner as the National Pay Scale 2026, the statement added.

The new pay scale introduces several benefits. For the first time, employees will receive Tk 3,000 monthly allowances for children with disabilities, and mobile allowances, previously limited to Grade 5 and above, will now extend across all 20 grades.

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“The cabinet approved the new pay scale, taking into account the government’s financial capacity, the country’s overall economic situation, the cost of living, and the need for a balanced and rational pay structure,” Cabinet Secretary Nasimul Ghani told reporters at a briefing after the cabinet meeting held at the Secretariat.

Under the new scale, the highest basic salary rises from Tk 78,000 to Tk 1,56,000, while the lowest jumps from Tk 8,250 to Tk 20,000.

Salaries in Grades 1-11 will double, while Grades 12-20 will see greater increases ranging from 115 to 142 percent. As such, the ratio between the lowest and highest grades has narrowed from 1:9.45 to 1:7.8.

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FOUR-PHASE ROLLOUT

The new pay scale will take effect retrospectively from July 1, 2026, and will unfold gradually over four phases.

Employees in Grades 10 to 20 will receive a 50 percent increase in their basic salaries in the first phase, effective from July 1. They will receive a further 25 percent increase from January 2027 and the remaining 25 percent from July 2027.

For officials in Grades 1 to 9, basic salaries will rise by 40 percent in the first phase, followed by another 30 percent increase from January 2027 and the final 30 percent from July 2027.

The fourth and final phase will begin on January 1, 2028, when all other allowances for employees across the 20 grades will be revised.

PENSION REFORM

In accordance with the election manifesto, the government is committed to introducing a One Rank One Pension (OROP) system. This system will be implemented simultaneously for both military and civilian employees.

However, given the substantial financial implications of implementing the OROP system at this time and the absence of data on civilian employees who retired before 2019, the government has decided to implement OROP in phases by 2030.

As an interim arrangement, however, the government has decided to significantly increase net pensions on a slab basis.

Net pension will increase by 100 percent for those receiving Tk 9,000 or less a month. It will go up by 75 percent for those receiving Tk 9,001 to Tk 20,000; by 65 percent for those receiving Tk 20,001 to Tk 30,000; by 60 percent for those receiving Tk 30,001 to Tk 40,000; and by 55 percent for those receiving Tk 40,001 or more.

EXPERT OPINION

Mustafizur Rahman, distinguished fellow at the Centre for Policy Dialogue, said the move was logical, as government employees had been working under the same pay scale for 11 years. During this period, while salaries rose slightly, inflation nearly doubled, eroding their purchasing power.

He, however, noted that the government faces fiscal constraints, particularly in revenue mobilisation. “Considering this, I would say the government has taken a bold step, both economically and politically.”

Mustafizur added that higher salaries would not necessarily strain the economy if government agencies simultaneously improved performance and efficiency. “If institutions involved in public services, trade, investment and revenue collection can enhance their capacity, the pay raise will not create undue pressure.”

He stressed that agencies must treat the additional spending on salaries as an incentive to improve service quality and efficiency.

Asked whether the new pay scale could fuel inflation, Mustafizur said the country had already experienced double‑digit inflation despite civil servants not receiving a new pay scale.

“The issue is not whether salaries should rise, but how the government manages the broader economy. The question is how we can improve macroeconomic management, boost business, trade and investment, increase supply and thereby bring inflation under control.”

At the press briefing, Nasimul Ghani said while pay scales are typically revised every five years, no changes had been made in the past 12 years, leaving employees struggling and their living standards significantly eroded.

On whether over six lakh MPO‑enlisted teachers and staff would be included in the new pay scale, Ghani said, “I cannot say this right now. You will know once a decision comes later.”

Speaking on government employees receiving two pay scales within 11 years while journalists have not had a new wage board in 16 years, he said, “Because of the government pay scale, the momentum of this [journalists’ wage board] will pick up. It will no longer remain stalled.”

9TH PAY SCALE

The Ninth National Pay Commission, formed in July 2025 under former finance secretary Zakir Ahmed Khan, submitted its report in January. A 10-member committee led by Cabinet Secretary Nasimul Ghani was formed in April to oversee implementation.

The Finance Division will issue gazette notifications detailing salary fixation, allowances, pensions, and post‑retirement benefits. Ministries and agencies will be instructed to ensure proper rollout.

Bangladesh introduced its first pay scale in 1973, followed by revisions in 1977, 1985, 1991, 1997, 2005, 2009, and 2015.