Pay Scale: Higher Salaries Must Come With Greater Accountability

The BNP government’s decision to introduce the ninth national pay scale has opened a fresh debate over public-sector salaries, fiscal discipline and the quality of public administration in Bangladesh.

The proposed pay structure involves substantial increases in the salaries of government employees. According to estimates associated with the proposal, the eventual annual cost could reach Tk 105,580 crore, while the first-year cost is expected to be around Tk 35,000 crore under the government’s phased implementation plan.

There is nothing inherently wrong with revising public-sector salaries. Government employees, like other workers, face rising living costs and inflation. Competitive remuneration is also important if the state is to attract and retain qualified professionals. The concern, however, is whether such a large increase in recurrent expenditure is financially sustainable and whether it will be accompanied by meaningful improvements in public services.

The timing of the decision makes the question particularly important. Bangladesh continues to face weak revenue mobilisation, inflationary pressure and higher energy and import costs. The government therefore has limited fiscal space to accommodate new permanent expenditure commitments.

The country’s tax-to-GDP ratio remains low by international standards, while the National Board of Revenue has struggled at various times to meet collection targets. Efforts to broaden the tax base, improve compliance, reduce unnecessary exemptions and bring more economic activity into the formal sector remain important unfinished tasks.

Against this backdrop, a large increase in the government’s salary bill could place additional pressure on public finances. Salaries and allowances are recurrent expenditures. Once increased, they become continuing obligations for the state, with future increments, promotions and other benefits adding to the cost. That raises an important question about priorities.

Public resources are limited, and Bangladesh needs substantial investment in infrastructure, energy, education, healthcare and other areas that can raise productivity and support long-term economic growth. The Annual Development Programme has already faced persistent implementation problems, including delays and underspending. A rapid expansion of recurrent expenditure could make it more difficult to maintain adequate development spending unless revenue collection improves substantially.

The issue is not simply the size of the pay increase. It is also what the government expects in return.
This point has acquired greater significance following recent comments by Parliament Speaker Hafiz Uddin Ahmed. Expressing his frustration with the performance of government officials, the Speaker reportedly said: “Ours is a strange country! Most government officials are corrupt. They engage in various forms of bribery and looting, making people’s lives unbearable.”

The Speaker’s statement is a serious criticism of public administration and should not be interpreted as proof that corruption is prevalent among every government employee. Nevertheless, it highlights a legitimate policy concern: “should a substantial increase in public-sector remuneration be introduced without simultaneously strengthening accountability and performance standards?”

Higher salaries by themselves cannot guarantee better governance. There is a long-standing argument that better-paid officials will have less incentive to engage in corruption and will be more motivated to perform their duties. Adequate remuneration can certainly be an important component of a professional civil service. But the relationship between salary and performance is not automatic.

A well-functioning public administration requires much more than competitive pay. It requires transparent recruitment, merit-based promotion, effective performance evaluation, professional training and credible disciplinary mechanisms. Officials must also be held accountable when they fail to perform their responsibilities or engage in proven misconduct.

This is where previous pay revisions deserve closer examination. Adequate questions have already been raised about whether proper analysis was conducted on the outcomes of earlier salary increases and whether those increases produced measurable improvements in governance. Such questions are relevant to the present debate. Before committing large additional sums to public-sector salaries, the government should examine what previous pay revisions achieved and where they failed.

The objective should not be merely to make government employment financially attractive. The objective should be to build a public service that delivers better outcomes for citizens.

The broader economic consequences also require attention. Government employees represent only a relatively small proportion of Bangladesh’s total workforce. The vast majority of workers are employed in the private and informal sectors and do not automatically benefit from revisions to the national pay scale. Private-sector employees, small businesses and low-income households could therefore experience the wider economic effects of a large public-sector pay increase without receiving a comparable increase in their own incomes.

One concern is inflation. If additional public expenditure contributes to demand-side pressure in an already inflation-sensitive economy, households outside the public sector could face higher prices. Such an outcome would be particularly difficult for lower-income families, whose purchasing power is already vulnerable to increases in food, transport and energy costs.

Energy prices present another challenge. Bangladesh remains dependent on imported fuel and energy-related inputs, leaving the economy exposed to movements in international energy prices. Higher fuel costs can increase the import bill, put pressure on foreign-exchange reserves and raise production and transportation costs throughout the economy. These circumstances make fiscal prudence essential.

The government’s decision to phase in the new pay scale rather than impose the full cost immediately is therefore significant. A phased approach can reduce the immediate budgetary shock. But phasing does not eliminate the long-term obligation. The government will still need a credible strategy for financing the higher salary bill over the coming years.

That strategy should be linked to broader fiscal reform. Improving tax administration, expanding the tax base, reducing leakage and increasing compliance would give the government greater capacity to finance essential public expenditure. At the same time, spending efficiency must improve. The state should know where public money is going, what outcomes it is producing and whether programmes are delivering value for taxpayers.

The ninth pay scale could therefore be an opportunity to establish a new understanding between the government and its employees: better remuneration in exchange for stronger professionalism, measurable performance and greater accountability.

Such a framework could include clearer performance indicators for government agencies, stronger monitoring of service delivery, greater use of digital systems to reduce opportunities for petty corruption, and more transparent procedures for recruitment, promotion and disciplinary action.

Citizens ultimately care less about the size of the government salary bill than about the quality of the services they receive. They expect government offices to function efficiently, licences and documents to be processed without unnecessary delays, public services to be accessible and officials to act lawfully and professionally.

The Speaker’s remarks underline the frustration that can arise when these expectations are not met. The government therefore faces a difficult balancing act. Public servants deserve fair compensation, particularly when inflation erodes purchasing power. At the same time, taxpayers deserve assurance that higher expenditure will translate into better administration and improved services.

The ninth pay scale should not be viewed merely as a salary adjustment. It should form part of a broader reform of the public service.

Higher salaries can help build a professional civil service, but they cannot replace institutional reform. Without stronger performance evaluation, accountability and financial discipline, a larger salary bill risks becoming simply a larger recurring obligation for the state.

The real measure of the ninth pay scale will ultimately be whether it helps create a more capable and accountable public administration while remaining compatible with Bangladesh’s fiscal realities.

The country needs a public service that is adequately compensated. But it also needs a public service that is efficient, transparent and answerable to the people it serves. “Better pay should therefore come with better performance—and greater public accountability.”