Sri Lanka to increase public sector salaries and allowances from 2025

Sri Lanka’s Cabinet Spokesman and Mass Media Minister Dr. Bandula Gunawardana announced on August 13, 2024, that the minimum starting salary for government employees will increase by at least 24%, with the gross salary set at Rs. 55,000, including the cost of living allowance.

All public service employees will receive a monthly cost of living allowance of Rs. 25,000 starting from the 2025 budget.

This announcement was made during the weekly Cabinet media briefing. The Cabinet had previously approved the formation of a specialist committee to review and propose salary revisions for all public service sectors.

The committee, led by former Secretary to the President Udaya Senevirathne, consulted with public officers and trade unions and submitted an interim report with recommendations.

Based on these recommendations, the Cabinet approved the following proposals, which will be included in the 2025 budget:

• All public service positions will be categorized into four levels, with sub-categories for recruitment based on the Sri Lanka Qualifications Framework (SLQF), National Vocational Qualification (NVQ), and job roles and responsibilities.
• Recruitment for all service categories will involve competitive exams and interviews, with qualifications based on the SLQF and NVQ.
• Existing service minutes will be revised, and the new salary and allowance structure will apply to all government institutions, excluding state trading companies and banks.
• The public sector workforce will be limited to one million or less by 2030.
• E-governance will be introduced across all sectors within three years through digitalization and automation.
• A new medical insurance scheme with a minimum monthly contribution of Rs. 1,000 will be implemented for all government employees and pensioners from January 2025.
• Services will be outsourced where possible to increase efficiency and reduce costs.
• State departments, corporations, and statutory institutions will be restructured as Public Liability Companies listed on the stock market.
• A comprehensive work study of the entire state sector will be conducted in 2025, with performance indicators introduced for all public sector employees, linking salary increments to their performance.
• Pensioners will receive 50% of the cost of living allowance given to active public employees starting January 2025.
• These changes will be implemented within the existing tax policy, starting from January 1, 2025, considering the state’s financial capacity.