Public Sector Workers’ Minimum Salary Increased by Rs. 15,750
President Anura Kumara Dissanayake announced a significant increase in the minimum basic salary for public sector employees, raising it from Rs. 24,250 to Rs. 40,000 – an increment of Rs. 15,750.
As part of the 2025 Budget, the government has also proposed revisions to the public sector salary structure, focusing on improving minimum wages and streamlining allowances.
“Given that nearly a decade has passed since the last basic salary revision, it is now time to revise the salary structure having evaluated all factors in a holistic manner. It is necessary to provide a decent living standard for public sector employees, enabling the Government to attract talent and skilled workers, whilst at the same time avoiding an excessive burden on the budget.
Accordingly, we propose to increase the minimum monthly basic salary from Rs.24,250 to Rs.40,000 by Rs.15,750. The current ad-hoc interim allowance and special allowance will be integrated into the basic salary giving a net increase of Rs.8,250 in the minimum salary.
The proposed minimum monthly basic salary increase of Rs. 15,750 will also be applicable to judicial services, public corporations, statutory boards, university staff, and officers of tri-forces on the same bas basis in line with the minimum basic salary increase for public sector employees.
In addition to a minimum monthly basic salary increase of Rs.15,750, it is proposed to raise the value of the annual salary increment by 80 percent.
Consequently, the minimum annual salary increment of Rs. 250 will be increased to Rs. 450. It is also proposed to adjust annual salary increments for all public sector employees to the same percentage.
The total estimated cost of this salary increase is expected to be Rs.325 billion.
Considering present fiscal constraints, it is proposed that this salary increase be implemented in phases. Of the total net salary increase, Rs.5,000 and 30 percent of the balance amount will be paid starting from April 2025, with the remaining 70 percent being paid in equal portions beginning in January 2026 and January 2027.
Therefore, it is proposed that Rs.110 billion be allocated for the proposed salary increase in 2025.
As part of this salary increase, it is proposed that the retirement benefits for officers retiring on or after 01.01. 2025 be calculated based on the new salary structure, ensuring that they receive retirement benefits under the proposed 2025 salary scheme.
Considering the increase in the minimum basic salary of state employees, the limit on distress loans for public servants which is currently set at Rs. 250,000 will also be increased to Rs. 400,000. “