Govt. proposes 55-74 percent pay hike for civil servants

If the parliament passes the Pay Revision Bill of Bhutan 2023, the civil servants will draw a salary hike of 55 to 74 percent on their minimum pay scale from July 1 this year.

To meet the rising cost of living, the Bill proposed a lumpsum upward revision of 50 percent on the minimum pay in all positions, continuing a one-off 5 percent indexation and one-off fixed payment of the Pay Structure Reform Act of Bhutan 2022.

The revision will also prorate per month the leave encashment of one month’s minimum pay scale and leave travel concession of one month’s minimum pay with a maximum ceiling of Nu 15,000.

Introducing the Bill yesterday, the Member In-Charge of the Bill, Finance Minister Namgay Tshering said that the revision was based on ensuring public servants are fairly remunerated and the revision will promote competency, meritocracy, and dynamism and at the same time endeavour to motivate and retain talents in the public service.

He also added that the revision is based on the Bhutan Living Standard Survey, which states that the minimum expenditure of Nu 19,374 per month in urban areas.

Salary for civil servants in EX3 or ES3 level and above is proposed to revise by 55 percent—50 percent lump sum and one-off 5 percent indexation.

For P1 level and below, the proposed revision is between 58 to 74 percent (50 percent lumpsum, one-off 5 percent indexation, and one-off fixed payment between Nu 1,000 to Nu 2,000).

For example, the Cabinet Secretary’s existing minimum basic monthly pay is Nu 84,180, excluding house rent allowance (HRA) of Nu 16,835 per month. With 50 percent proposed pay revision and one-off 5 percent salary indexation, he or she is entitled to 55 percent pay hike amounting to Nu 130,480 per month.

Similarly, a driver (O4) draws a minimum monthly basic pay of Nu 10,550, excluding the HRA of Nu 3,500 per month. With the proposed pay revision of 74 percent, a driver will get Nu 18,355 per month (50 percent plus one-off 5 percent and an additional Nu 2,000 lumpsum one-off fixed payment).