The Pay and Service Commission has recommended increasing salary of public servants by 100 percent on average, full implementation of which would raise the government spending on salary and allowance by 63.7 percent. The commission, led by its Chairman Mohammad Farashuddin, submitted the report to Finance Minister AMA Muhith yesterday. The report also recommended that the government provide each e
mployee with a special package, including a flat and health benefits. Farashuddin later told reporters the recommendation of pay hike was done to attract meritorious and efficient people to join government services. This is why the committee recommended a 120 percent hike in the basic salary of cadre officers at the entry level. The pay structure has been recommended supposing a service holder has a six-member family, including his or her parents. The commission also took into account the salary structure in neighbouring countries and the private sector. Muhith said the pay commission report would be implemented in phases, starting from July 1, 2015. According to Muhith, the country's economic progress has been good and it is vital to have an efficient and satisfied administration for its management. The government has the money to implement the pay hike. Advertisement “Government's money is people's money and it has to be spent for the wellbeing of the people,” the minister said. The existing budget has Tk 28,709-crore allocation for salary and allowance of around 13 lakh government employees. Implementation of the recommendations will require another Tk 18,247 crore. This is excluding the enhanced salary of some 6 lakh non-government school and college teachers. Asked if it would push up inflation, Muhith said, “Absolutely not. It will have no impact on inflation.” The minister said the budget allocation for salary would not increase because of this pay hike and that it would rather come down. The allocation for salary in the current fiscal year is 15.7 percent of the total budget. But the budget gets bigger every year. So if this pay hike is implemented in full, salary of the government employees will eat up only 14.2 percent of the budget, said Farashuddin, also former Bangladesh Bank governor. The commission suggested cutting down the number of grades to 16 from existing 20. It also recommended lowest basic salary at Tk 8,200, up from Tk 4,100. The proposed maximum basic salary is Tk 80,000, up from exiting Tk 40,000. Outside the grades, Tk 88,000 has been recommended as basic pay for senior secretaries instead of existing Tk 42,000. Tk 1 lakh monthly basic salary has been proposed for the cabinet secretary and the principal secretary to the prime minister. At present, they get Tk 45,000 in basic pay. The existing grade 9 will be merged with grade 8 and the basic salary has been suggested Tk 25,000 instead of existing Tk 12,000 and 11,000. The current pay scale was implemented in 2009, four years after the previous one. The new pay scale comes into force in the span of six years. The cumulative inflation rose by 63 percent in these six years and the commission kept that in mind while preparing the recommendation, said Farashuddin. Recommendation for yearly increment has been made in a way so that the basic salary doubles in 15 years. The yearly increase of 4th to 16th grade employees has been fixed at 5 percent and it will increase in an incremental way. The commission chairman said those who will fall in the first grade will get an additional 5 percent of the basic pay or Tk 4,000 every month for performing additional responsibilities outside their duty. Farashuddin said the commission recommended making the house rent and other allowances more logical. NON-GOVT SCHOOLS The commission suggested implementing the new pay scale for the schools under Monthly Pay Order (MPO) six months after it is implemented for government service holders. Farashuddin said the time for implementing the pay scale for the teachers is required for its objective evaluation. He said they recommended that the non-government schools deposit to the government exchequer a part of the money they receive from students. SEPARATE PAY SCALE The commission suggested a separate pay scale for Bangladesh Bank but urged the government not to give any separate pay scale for the public organisations incurring losses. Farashuddin said there was no logic for giving separate pay scales for public universities, state-owned banks, financial institutions and insurance firms. SPECIAL PACKAGE FOR FLATS The commission made several alternative recommendations so that every government employee may own a flat. One of them is building flats by real estate companies by dismantling old government buildings. The government will own 60 percent shares of the flats while the developers 40 percent. The flats will be distributed among public servants on hire-purchase basis. Another recommendation is that a group of 10-20 government employees will be given 5-10 kathas of land where they will build flats. For the construction, they will be given loans equivalent to 50 months' basic salary. Another alternative is that a group of government employees will purchase land and providing the proof of the purchase they will get house building loans equal to 50 months' basic salary at the bank rate. INSURANCE POLICY The commission recommended providing government staff with mandatory health insurance. The government would deposit Tk 400 for each employee for general insurance policy, which would cover death in accidents, and treatment cost. It would also deposit Tk 100 for life insurance. An employee would receive a maximum of Tk 5 lakh in insurance and the compensation package would be paid directly to the hospital. Farashuddin said if it was done, the insurance sector would also throb. Though the government expenditure on insurance premium would be high in the first year, it would gradually come down. He added they also suggested that the government set up a 500-bed cardiac hospital with the premium money for government employees. CAR LOAN The commission proposed a maximum of Tk 25 lakh car loan facility for officers of grade three and above and that the facility could be extended to grade four officers later. PENSIONERS' BENEFIT The commission recommended making the rate of pension 90 percent instead of existing 80 percent of basic salaries. It also suggested that the facilities for pensioners be increased at the rate of the salary hike of the government employees. SEPARATE BANK The setting up of a bank styled “Bank for Steps to Prosperity”, owned and run by the government employees, has also been recommended. Farashuddin said the government welfare fund has a piece of land at Dainik Bangla intersection and selling 20-25 kathas of it could fetch Tk 400 crore, enough for the capital of the new bank. Each government employee would have a Tk 4,000 share in the bank. He added the bank would provide development and commercial loans possibly on single-digit interest rates. CIVIL SERVICE REFORM The commission made several recommendations for civil service reforms. It suggested making the job tenure for voluntary retirement 20 years instead of 25. It also proposed forming a development management pool, with officials selected on merit and efficiency. The commission also suggested taking exams for promotions. Muhith said the government could take various initiatives as it had enough money. He said more initiatives would be taken in the next four years. Finance Secretary Mahbub Ahmed said even if 100 percent of the Pay Commission recommendations were implemented, there would be no shortage of money and the government was capable of making it effective from this fiscal year.
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