DHAKA, June 3, 2025 (BSS) - The government has introduced a special financial incentive for public sector employees and pensioners to elevate their earnings in tackling daily expenses which is going to be effective from July 1.

The finance division today issued a gazette notification saying employees in Grades 1 to 9 will see an increase of 10 percent of their basic pay matured on July 1 every year starting from July 1 this year, while those in Grades 10 to 20 will get salary with an increase of 15 percent.

It said the special incentive amount will be minimum Tk 1,000 for employees and Tk 500 for pensioners.
 
The declaration came merely a day after Finance Adviser Dr Salehuddin Ahmed unveiled a TK 789,999 crore proposed budget for the 2025-2026 fiscal.

The notification said, "By the authority granted under Section 15 of the Public Service Act, 2018, a 'special allowance' is hereby introduced, effective from July 1, 2025, for government-civilian employees under the National Pay Scale, as well as employees engaged in autonomous and state-owned institutions, banks, insurance and financial institutions, Border Guard Bangladesh, and the police force, including reinstated pensioners and other pension recipients." 

It added, "The allowance will be provided at a rate of 10 percent for those in pay grades 1 and above up to grade 9, and at a rate of 15 percent for those in pay grades 10 to 20."

It further mentioned that employees on Post-Retirement Leave (PRL) will get special allowance based on their last drawn basic salary prior to entering PRL.
 
Reinstated pensioners and other pension recipients from the government will receive the special allowance on the existing portion of their pension, based on the grade-wise rates.

Retired employees who have withdrawn 100 percent of their gross pension and received a lump-sum gratuity, and who are not yet eligible for pension restoration, will not be entitled to this special allowance.

For government employees appointed on a contractual basis under any designated grade of the national pay scale, the allowance will be calculated based on the last drawn basic salary immediately prior to the contractual appointment.

However, if such a contractually appointed person is also a pensioner, they will be eligible for the allowance on either the existing portion of their pension or the last drawn basic salary before contractual appointment whichever one applies, but not both.

Besides, employees who are temporarily suspended will receive the special allowance on 50 percent (half) of their last drawn basic salary prior to suspension.

In addition, employees on leave without pay will not be eligible for this special allowance.

The notification also stated that for employees of autonomous bodies, state-owned enterprises, banks, insurance companies, and financial institutions that are under the National Pay Scale 2015, except institutions operated solely on government revenue budget grants, the required expenditure for the special allowance must be borne from the respective institution's own budget.