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In a major financial relief package for retired public servants, particularly lower- and middle-tier pensioners, the government has scaled up net monthly pensions by 55% to 100%, fixing the minimum pension at BDT 18,000 and the maximum at BDT 70,200.
According to an official gazette notification issued by the Ministry of Finance, the revised pension benefits are deemed effective retrospectively from July 1, 2026. Government employees currently on Post-Retirement Leave (PRL) will also be covered under the enhanced structure.
The notification also eliminated a longstanding administrative hurdle for surviving spouses receiving lifetime family pensions. Previously, widows or widowers had to submit annual certificates or written undertakings to audit and accounts offices declaring that they had not remarried. Under the new guidelines, this mandatory non-remarriage certificate requirement has been completely waived for widows aged 50 and above.
The recalculated net pension has been determined based on the basic net pension drawn by a pensioner as of June 30:
Net pensions up to BDT 9,000: Raised by 100%, with new benefits ranging from BDT 10,000 to a maximum of BDT 18,000.
Between BDT 9,001 and BDT 20,000: Increased by 75%, scaling to a range of BDT 18,001 to BDT 35,000.
Between BDT 20,001 and BDT 30,000: Increased by 65%, revising payments to BDT 35,001 to BDT 49,000.
Between BDT 30,001 and BDT 40,000: Raised by 60%, adjusting rates from BDT 49,001 to BDT 62,000.
BDT 40,001 and above: Increased by 55%, setting the revised range from BDT 62,001 to the new ceiling of BDT 70,200.
For pensioners already drawing a net monthly pension exceeding BDT 70,200, existing disbursements will remain unchanged until the next annual increment cycle scheduled for July 1, 2027.
The qualifying tenure for pension benefits has been set at a minimum of 5 years, yielding 21% of the basic salary. The pension replacement rate scales progressively: 36% for 10 years of qualifying service, 54% for 15 years, 72% for 20 years, 75% for 21 years, 79% for 22 years, 83% for 23 years, 87% for 24 years, and a maximum of 90% for service spanning 25 years or more.
Employees who become incapacitated on medical grounds or pass away before completing 5 years of service will receive a one-off financial grant equivalent to three times their last-drawn basic pay for each year of completed service. Furthermore, retirees will receive leave encashment of up to 18 months of basic pay based on earned leave balances, regardless of whether PRL is availed.
