Up to 100% pension hike for low-paid retirees

The government has decided to increase the pensions of retired government employees receiving lower net pensions by up to 100 percent under the National Pay Scale 2026.

The slab-based pension increases were approved at a Cabinet meeting on Monday (August 31), alongside the approval of the National Pay Scale 2026, according to a press release from the Finance Ministry.

Under the decision, pensioners receiving a monthly net pension of Tk9,000 or less will get a 100 percent increase. Those receiving Tk9,001 to Tk20,000 will receive a 75 percent increase.

Pensioners receiving Tk20,001 to Tk30,000 will get a 65 percent increase, while those receiving Tk30,001 to Tk40,000 will receive a 60 percent increase. Those receiving Tk40,001 or more will get a 55 percent increase.

The government said it remains committed to introducing the “One Grade, One Pension” or One Rank One Pension (OROP) system for both military and civilian personnel, in line with its election manifesto.

However, due to the substantial financial implications of implementing the system simultaneously and the lack of data on civilian employees who retired before 2019, the government has decided to introduce OROP gradually by 2030.

As an interim measure, the government decided to substantially raise net pensions on a slab-based system, taking into account retirees’ living standards and financial security in old age.

The Finance Ministry said the decision would provide significantly higher increases to pensioners who retired many years ago and currently receive relatively low net pensions.

The pension increases will also be implemented in phases.