Govt pay hike may put pressure on private sector, but inflation control crucial: Fazlul

The proposed pay rise for government officials and employees is unlikely to have any immediate adverse impact on the private sector, said FBCCI Administrator Md. Fazlul Hoque. However, he warned that if the increase adds to existing inflationary pressures, it could put private-sector employers under strain to raise wages as well.

In an exclusive interview with The Daily Observer on Monday, the country’s apex trade body-Federation of Bangladesh Chambers of Commerce and Industry (FBCCI) chief said the private sector is already facing a number of challenges, with the sector’s overall situation currently unfavourable. Those working in the private sector are also feeling the impact of the difficult business environment, he maintained.

He noted that the average salaries of government employees are reasonably good and, therefore, it would be difficult to say that they are severely deprived.

At the same time, he maintained, the government is the largest employer, and the issue of increasing the salaries of government officials and employees therefore deserves consideration.

“From the perspective of government employees, their demand for a pay hike is a longstanding one. Their salaries have not been increased for a long time,” he said.

From the perspective of the private sector, the expectation is that an increase in government salaries will lead to better services from government officials for businesses and the private sector. Their efficiency and quality of work should improve, while services should be delivered more quickly, he added.

Md. Fazlul Hoque stressed that the government must ensure that implementation of the new pay scale does not create additional pressure on inflation.