The government has officially announced a ‘special allowance’ for public employees, replacing the long-anticipated dearness allowance.
Effective from July 1, 2025, employees from pay grades 1 to 9 will receive a 10% increment on their basic salary, while those in grades 10 to 20 will get a 15% increment. A minimum of BDT 1,000 will be provided for working employees, and BDT 500 for pensioners.
The announcement was made through a circular issued by the Finance Division under the Ministry of Finance on Tuesday.
This special benefit will apply to all government-civilian personnel under the national pay scale, including those employed in autonomous bodies, state-owned enterprises, banks, insurance and financial institutions, Border Guard Bangladesh (BGB), and the police force.
Finance Minister Salehuddin Ahmed proposed this measure in the 2025–26 national budget to address the absence of a revised pay scale since 2015. Though earlier discussions centered on a formal dearness allowance, the government opted to introduce the increment as a “special allowance” instead.
Retired employees on post-retirement leave (PRL) will receive the benefit based on their last drawn basic salary. Pensioners with reinstated pensions will receive the allowance based on their current pension amount.
However, those who have fully surrendered their pensions for lump-sum gratuity and are not eligible for reinstatement, as well as employees on unpaid leave, will not be covered under this scheme.
The circular ends months of speculation and clarifies that this special allowance is a temporary measure in lieu of revising the full pay scale.
