In a groundbreaking announcement, President Anura Kumara Dissanayake outlined significant measures in the 2025 budget aimed at improving the living standards of public sector employees across Sri Lanka.
After nearly a decade since the last revision of public sector salaries, the President proposed a substantial increase in the minimum monthly basic salary, raising it from Rs. 24,250 to Rs. 40,000—an increase of Rs. 15,750. This move seeks to ensure that public sector employees are adequately compensated, promoting a more attractive work environment for skilled professionals while maintaining a balanced fiscal approach.
The proposed salary adjustment will see the integration of current ad-hoc interim and special allowances into the base salary, resulting in a net increase of Rs. 8,250. The new salary structure will apply not only to government employees but also to judicial services, public corporations, statutory boards, university staff, and officers in the tri-forces, ensuring that all sectors benefit from the hike.
In addition to the base salary increment, President Dissanayake announced an 80% increase in the annual salary increment value, raising the minimum annual increment from Rs. 250 to Rs. 450. Public sector employees will see this adjustment implemented across all ranks.
The total estimated cost of the salary revision is Rs. 325 billion. Due to current fiscal constraints, the salary increase will be rolled out in phases. From April 2025, employees will receive Rs. 5,000 along with 30% of the balance amount. The remaining 70% will be distributed in equal portions starting in January 2026 and 2027. The budget allocates Rs. 110 billion for the salary increase in 2025 alone.
In a further measure of support, the President proposed that retirement benefits for public sector employees retiring on or after January 1, 2025, be based on the new salary scheme, ensuring that they are compensated fairly under the revised pay structure.
Additionally, the limit for distress loans available to public servants will be increased from Rs. 250,000 to Rs. 400,000, further enhancing financial support for state employees.
These proposed changes, aimed at improving the welfare of Sri Lanka's public sector workforce, are a key part of the government's broader strategy to attract and retain skilled professionals while ensuring fiscal responsibility.
