The Ninth National Pay Commission on Wednesday proposed a sharp increase of government salaries, recommending that the minimum basic pay be raised by 142 per cent from Tk8,250 to Tk20,000 and the maximum basic pay by about 105 per cent from Tk78,000 to Tk1.6 lakh.
According to the commission, implementing the proposed pay structure would require an additional Tk1.06 lakh crore in annual government spending, an 81 per cent increase from the Tk1.31 lakh crore the government currently spends each year for around 14 lakh public servants and 9 lakh pensioners.
In budgetary terms, the additional Tk1.06 lakh crore is equivalent to about 13.25 per cent of the last national budget of Tk8 lakh crore, underscoring the scale of the fiscal impact of the pay commission plan after a decade.
While high inflation has strengthened demands for wage increases across the economy, economists warned that the size and structure of the proposed hike could worsen inflationary pressure and widen income inequality.
“Inflation does speak for pay hikes across the economy and the government has a responsibility to ensure the wellbeing of its employees,” Centre for Policy Dialogue Executive Director Fahmida Khatun told TIMES of Bangladesh.
However, she said the proposed pay scale creates a serious imbalance. “The problem is that the new pay scale will help the government employees only, while the private sector cannot afford the same,” she said. “It will add to inflation and the majority people who will not get the pay hike will face the consequences. Inequality will rise.”
She also questioned the role of the interim government in pursuing such a major fiscal decision. “The big decision to raise the government’s annual expenditure by more than Tk1 lakh crore should not be implemented by the interim government. Let a political government decide on this,” she said, adding that fiscal pressure would mount immediately once the new pay scale is implemented.
The commission submitted its report to Chief Adviser Muhammad Yunus on Wednesday, three weeks ahead of schedule.
The 23-member commission, led by Chairman Zakir Ahmed Khan, was formed on July 27, 2025 with a six-month deadline. The final submission date had been set for February 14, 2026. According to a press release, the commission completed its work using only 18 per cent of its allocated budget.
Finance Adviser Saleh Uddin Ahmed, Chief Adviser’s Special Assistant Anisuzzaman Chowdhury, Finance Secretary Khairuzzaman Mozumder and all full-time and part-time members of the commission were present during the report submission.
After receiving the report, Yunus expressed satisfaction and thanked the commission members, saying, “It is a massive task. People have been waiting for this for a long time. From the outline, it is clear that this has been a very creative piece of work.”
Commission Chairman Zakir Ahmed Khan said global and national economic indicators have changed significantly over the past decade, with prices of essential goods rising multiple times. He said the absence of a timely and appropriate pay structure has made it increasingly difficult for government employees to cope with the cost of living.
Working under clearly defined terms of reference, the commission reviewed existing pay, allowances and other benefits before making its recommendations. To do so, it held 184 meetings both online and offline, collected opinions and proposals from 2,552 stakeholders and conducted extensive consultations with associations and professional groups.
Another key responsibility of the commission, he said, was to determine the financial resources required for implementing the proposed pay structure and to assess its feasibility.
Beyond revising salaries across 20 pay scales, the report recommends introducing health insurance for government employees, reforming the pension system, restructuring the Government Employees Welfare Board, forming a service commission, rationalising pay grades and scales, reviewing allowances through a dedicated committee and strengthening human resources in the health and education sectors.
Speaking at the report submission, Finance Adviser Saleh Uddin Ahmed said the next step would be to analyse and implement the recommendations and that a committee would be formed to work on implementation methods. Earlier at a press briefing on Tuesday, he rejected fears of an inflation surge, saying the government has been strengthening the supply side of the economy.
Finance Ministry officials said that after a pay commission report is submitted, it usually takes at least three to four months to move toward implementation. They also said political parties have been putting pressure on the interim government not to implement the pay hike before an elected government takes charge.
Government employees are currently paid under the 2015 pay structure.
With minimum and maximum basic salaries set to rise by more than 100 per cent and the total wage bill poised to increase by over 80 per cent, the commission’s recommendations have intensified debate over inflation risks, inequality and whether an interim administration should take responsibility for a decision with long-term budgetary consequences.
Echoing Fahmida Khatun, economist and Policy Exchange Bangladesh Chairman M Masrur Reaz said the pay hike is justified as the existing government pay structure is inadequate. However, he said the timing is crucial as the economy is struggling with high inflation, slow growth and fiscal pressure.
He warned that implementing a plan that raises government spending by more than 13 per cent would require similar growth in revenue, which is unlikely in the current context. In that case, he said, rigid implementation would lead to higher government borrowing and further increase fiscal pressure.
