Spending on public servants' remuneration to witness uptick from next fiscal

The allocation of money for salaries and allowances of the public sector will see an uptrend from the next fiscal after a span of four years.

The government is going to allocate some 12.2% of the total budget in the upcoming fiscal of 2021-22 for salaries and allowances to the public servants and other related pockets.

The allocation of this sector will be 12.5% in 2022-23 fiscal of the total budget, according to an official document.

The estimated amount of money for the next two fiscals would be Tk 745.3 billion and Tk 869.8 billion respectively.

After the 2016-17 fiscal, the amount of spending in salaries and allowances for the public servants, as a proportion of the budget witnessed a downward slide.

In 2016-17 fiscal the allocation was 18.2% while it nosedived to 14.8% in 2017-18 fiscal.

The allocated amount for the 2016-17 fiscal was Tk 490.43 billion whereas the allocation reduced to Tk 478.5 billion in the following fiscal.

As per the document, the allocation in 2013-14 fiscal was Tk 263.94 billion (14%) and Tk 288.20 billion (14.8%) in 2014-15.

The allocation saw a sharp rise in 2015-16 and 2016-17 fiscals with 16.7% and 18.2% of the total budget allocation. The amounts during these two fiscals for the salaries and other allowances were Tk 400.50 billion and Tk 490.43 billion.

The document said that the rise in the allocation occurred due to implementation of the new pay scale for the public servants that continued for the two consecutive fiscals.

The expenditure in the sector reduced to 14.8% (Tk 478.5 billion) of the budget in 2017-18 fiscal and 13.6% (Tk 534 billion) in 2018-19 fiscal.

The trend continued in 2019-20 fiscal with 12.2% and in 2020-21 fiscal with 11.6%.

The allocation for the fiscals were Tk 607.5 billion and Tk 650 billion respectively.

The official document expected that the trend of expenditure for the salaries and allowances in the coming two fiscals would be in the normal trend with 12.2% and 12.5% allocation of the total budget.

The country is likely to get Tk 5933.14 billion budget for 2021-22 fiscal, Tk 253.14 billion higher than the running one, aiming to face the COVID-19 pandemic challenge for recovering the economy.

Amid the coronavirus crisis, the government had taken up a comprehensive plan with four main strategies.

These are: discouraging luxury expenditures, prioritising government spending that creates jobs, creating loan facilities through commercial banks at subsidised interest rate for the affected industries and businesses, and expanding the coverage of the government's social safety net programmes.

Meanwhile, the government has estimated to bring down its expenditure in current account while increasing the capital expenditure in the next 2021-22 and 2022-23 fiscals.

According to an official document, the current expenditure for 2021-22 and 2022-23 fiscal has been estimated at 54.4% and 54.5% of the total budget respectively.

Salaries and allowances of public servants, purchase of product and service, compensation and relocation expenses, payment of interest against foreign and domestic loans are under the segment of current expenditure. Besides, 'food accounts' and 'expense for structural coordination' are also under this expenditure.

On the other hand, government funded annual development programme (ADP) and non-ADP capital expenditure are the main two items under the capital expenditure. Besides, loan and advance, development programmes from revenue budget, projects outside the ADP and non-ADP food for work programme and handover expenses are also under this expenditure.