The government has decided not to allocate any specific funds for a new pay structure for 13 lakh civil servants, instead they will go for block allocations under the eighth pay and service commission, official sources have said.
In a meeting at the Prime Minister’s Office on Saturday, Finance Minister AMA Muhith informed Prime Minister Sheikh Hasina on their plans to not set aside fund allocations for the next fiscal since the commission plans to announce a new pay structure within December this year, said a Finance Ministry official who was present at the meeting, requesting anonymity.
The official added that a proposal has also been sent to the premier to extend the duration of the current pay commission until December.
During Saturday’s meeting, Muhith also presented a broad outline of the next year’s macro-economic target and budget outlay to the premier, the cabinet members and the secretaries who were present.
Sources in the pay commission of the government wanted to please the people and not irk the public servants.
The Finance Division allocated Tk4,000 crore for the 20% dearness allowance in the outgoing fiscal; as a result, allocation of the salaries of civil servants amounted to Tk28,867 crore. For the next fiscal, the budget will have an allocation of Tk25,000 crore for the salary and allowance of the government employees.
The government will increase the block allocation from the outgoing fiscal’s Tk4,299 crore to Tk5,000 crore in the next 2014-15 fiscal. The amount of the block allocation will be used in the pay structure hike, if the government announces the next pay commission in December this year, according to the Finance Division.
In the pay commission’s first meeting in February however, former Bangladesh Bank governor Mohammad Farashuddin, who is leading the 17-member commission, said the announcement of the next pay structure is likely to take at least 12 months.
He said no previous commission could submit the report in 15 months. The government formed the pay commission on November 24 last year and issued an order and made it effective from December 17, just before the national elections.
In fixing the new pay scale, the commission will consider the living costs of a six-member family, not a four-member family like the previous commissions, Farashuddin said.
Issues like inflation, the government’s financial position and the salary structure of government employees in other countries will also be considered.
The economy has made much progress after the last pay raise, he said, adding: “The government employees should also be beneficiaries of the economic prosperity achieved by the country.”