The National Pay Scale 2026 approved on Monday last has received a cautious welcome. It is the highest ever pay rise ranging from 100 per cent to 142 per cent for 2.4 million civilian and military employees in the country's history. Along with them, 90,000 retired employees will also get a share of the largesse, raising the total number of beneficiaries to 3.3 million. Currently, the annual expenditure on these heads is around Tk 1.31 trillion and an additional yearly expenditure of Tk 1.0558 trillion will be required to implement the new pay scale. To be implemented in three phases between July 2026 and July 2027 with its retrospective implementation from July 01 last, the financial involvement is evidently quite challenging. When the pay scale for the Bangladesh Judicial Service is finalised with retrospective effect from the same date, the expenditure will rise further.
The phased implementation itself is a clear evidence of the funding constraints the government faces at a time when the National Board of Revenue (NBR) falls far short of collecting the targeted revenue. News from the private sector, particularly the manufacturing and productive sectors, is hardly encouraging. Shortage of gas and electricity has forced industrial output below capacity and in certain cases temporary closure of factories and industries. Even the fertiliser factories cannot operate due to gas and power crisis. There is no sign of any improvement of the energy crunch with the Middle East conflict over the Hormuz Strait continuing. At a time when the country is witnessing an economic slump, the NBR cannot be expected to collect revenues enough to finance the additional costs. What will be the government's source of income or fund accumulation?
Well, the country's administration has resorted to borrowing from banks in case of fund constraints. But that is not a good option particularly when the banking sector is undergoing a phase of economic deceleration with manufacturing and businesses slowing further. The last option is to print currency notes---a most unwise move to overcome funding crises. A cautious and prudent approach aimed at containing inflation through phased implementation of the pay scale will be nullified if this happens. The government should beware of the danger involved.
Even if the government can somehow manage enough money to pay for salaries and other benefits under the new pay scale, there will be no escape from fuelling inflation because of a lack of investment, creation of wealth and employment. When the existing factories and industries cannot go into capacity production or even forced to close down, fresh investment is out of question. The private sector will definitely be under pressure to raise salaries of employments but when business is dull, they will be unable to introduce any new pay scale. This will create a more discriminatory market and society.
Last but not least, the stated objective of the government is to "strengthen the financial security and morale of public employees and contribute to a more efficient, dynamic and people-oriented administration". Fair enough. But is there any guarantee of elimination of graft from government offices? Aghast at the bribery culture so endemic in government offices, a 17-year-old boy from Mymensingh has launched, according to a leading contemporary, a website 'ghus site'. Within just 11 days, more than 11,000 complaints involving Tk 34 million in bribery have been submitted. The bureaucracy, particularly not known for efficiency in execution of annual development plan (ADP) and professional integrity, is going to be rewarded disproportionately. Watch out how they deliver the goods from now on.
