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Basic salary hike pattern

View of a non-economist

MD. ASHRAFUL ISLAM
It seems that both pay commission and secretaries' committee have identified some groups of government employees to be encouraged. It also seems that the grade-4 employees have insignificant efforts to serve the nation. They should work hard to have maximum hike in the future.***
SALARIED men of Bangladesh are quite happy with the new pay scale recommended by the 6th pay commission, revised by the committee of secretaries and finally approved by the cabinet. All must be thankful to the Finance Minister M Saifur Rahman for his kind initiatives, no matter how it is going to be implemented. There must be established economic theories and experiences based on which a salary structure is formulated. As a noneconomist, I would like to focus only on the recent patterns of salary structure and its hike with a view to having better structurein the next scale.
There are 20 grades in the salary structure. I believe, these too many grades are fixed considering usual economic practices in the world. Basic salary varies from Taka 1500 to 15000 in the previous scale and from Taka 2400 to 23000 in the approved new scale having approximately a constant ratio of 1:10 between grade-20 and grade-1. Grade-wise salary structures for previous, proposed and approved scales are plotted in the figure given below. Grade-wise percent of salary enhancements in both proposed and approved scales are also exhibited in the figure. Percentage of curtailment by the secretaries' committee is also shown.
Figure 1 contains two ordinates: left one may be called the 'primary axis' that reads the basic salary and the right one 'secondary axis' that contains percent change in salary. Different lines show the salary structure for previous, proposed and approved scales and small circle connecting lines show the percent change. From the figure it is clear that salary sharply decreases from Grade-1 to grade-10 beyond which it decreases slowly and remains almost constant. In other words, salary in the approved scale changes from Taka 2400 to 4100 from grade-20 to grade-11 (containing 10 grades) while it changes from Taka 23000 to 5100 from grade-1 to grade-10 (again containing 10 grades). Same was also true in the previous pay structure. It may be learned from this behaviour that latter 10 grades are introduced to accommodate employees of similar aptitude and there is a chance to squeeze these grades. It needs special attention to look into the matter and to find an amicable solution. It seems to me that number of grades could be reduced to around 12 which would eventually reduce the ratio people used to demand. it is understood that government salary expenses may increase and can be resolved in many different ways.
As mentioned above, Fig. 1 also shows the percent increase in salary proposed by the pay commission and approved by the cabinet. it is interesting to note that salary in different grades has been enhanced by different percent. For example, about 53 per cent hike for grade-1, minimum 40 per cent hike for grade-4 and maximum 63 per cent hike for grade-17 have been approved. similar variable hikes were also proposed by the pay commission having 83 per cent hike for grade-1, minimum 70 per cent for grade-4 and maximum 94 per cent hike for grade-18. The percent hike in the lower grades (grade-11 to grade-20) is considerably and necessarily higher in both proposed and approved scales. ups and downs in percent hike in the higher grades (grade-1 to grade-10) are not understood to a non-economist. i doubt whether any economic theory does support this. This can only save some salary expenses of the government depriving the employees in the low-hiked grades. This seems to be unethical. Percent hike should be constant. otherwise grades have to be revised.
The bottom curve having linecircle-line shows how committee of secretaries operated knives on the recommended pay scale. An average of 16 per cent decrease in hike has been made by the secretaries' committee having maximum reduction in grade-4 and minimum in grade-6.
From the above analysis it is clear that both pay commission and secretaries' committee have identified some groups of government employees to be encouraged. it is also learned that the grade-4 employees have insignificant efforts to serve the nation. They should work hard to have maximum hike in the future. This narrow analysis is definitely not enough to comment on the national policy. i hope economist of our country would start thinking towards an amicable solution for the pay structures to come. Md. Ashraful Islam is a JSPS Fellow, Saga
University, Japan.