Ministry of Economy

In a move to significantly benefit civil servants across the country, the government has announced a substantial pay increase effective August 1, 2024.

The announcement was made by Minister for Finance Professor Biman Prasad during the presentation of the 2024-2025 Budget.

Professor Prasad revealed that salary-based civil servants would receive a pay rise ranging from 7% to 10%, while wage earners are set to see increments between 10% and 20%.

Specifically, the lowest wage in the civil service, which falls under Band A, will increase from $4.60 an hour to $5.60 an hour—a 20% rise.

Those in Band B, currently earning $6.27 an hour on Step 3, will enjoy a substantial 60% pay increase.

“This major pay rise will inject almost $85 million into the pockets of our approximately 42,000 public sector employees, these pay increases range from 7% up to 20%, depending on the salary bands.”

He emphasized the importance of an independent, professional, and well-equipped civil service for effective service delivery and implementation of the government’s policy agenda.

Professor Prasad highlighted that the civil service is a crucial component of the government machinery, providing the administrative prowess and institutional capabilities necessary to execute policies efficiently and effectively.

Unfortunately, the civil service has faced years of neglect, with stagnant remuneration and deteriorating employment conditions.

The sector has also suffered from a lack of investment in training, capacity building, and poor succession planning.

Professor Prasad pointed out that the civil service has been adversely affected by biased promotion practices under the Open Merit Recruitment System (OMRS), leading to inequities in pay structure and political interference in appointments.

In addition to addressing these issues, the government has made significant changes to improve employment conditions for civil servants.

Prof. Prasad says permanent employment tenure has been reinstated, providing stability and certainty, and the retirement age has been increased from 55 to 60 years, with a further extension to 62 years for scarce skill areas.

Currently, there are over 42,000 publicly funded employees, including approximately 38,000 in the civil service and almost 4,000 in independent institutions and state-funded entities, costing around $1.2 billion.

The announced pay rise is expected to bring much-needed relief and recognition to these employees, reaffirming the government’s commitment to enhancing the civil service’s capabilities and working conditions.

Additionally, the government is allocating an extra $5 million to accommodate pay rises for staff in independent institutions such as Parliament, the Legal Aid Commission, the Office of the Director of Public Prosecutions, and the Office of the Auditor General.

These institutions have not had a job evaluation or salary adjustment since 2017.

However, entities that have seen salary progression over the years are excluded from this adjustment.