Government Announces Eight Decisions on Pay and Allowances for Contract-Appointed Officials After the New Pay Scale

The government has announced eight decisions on fixing the pay, allowances and other benefits of contract-appointed officials following the introduction of the ninth national pay scale. The decisions were announced in a notification issued by the Finance Division of the Ministry of Finance on Thursday (29 October).

The notification said the new decisions were taken because the National Pay Scale 2026 came into effect on 1 July, requiring fresh rules for the pay and allowances of people appointed on contract.

The decisions will apply to contract appointees serving in the public interest in government and autonomous institutions, state-owned banks and financial institutions, and various civilian posts of the republic.

Under the first decision, employees appointed on contract before 1 July 2026 under the National Pay Scale 2015 whose contracts continue beyond 1 July will, subject to amending their contracts with the government, have their pay fixed from 1 July in the corresponding grade and step under the National Pay Scale 2026.

These employees will receive pay at the increased rates under the specified provisions of the Service (Pay and Allowances) Order 2026 from 1 July, excluding the annual increment portion, along with the allowances applicable to them under their contracts with the government.

Under the second decision, those appointed to contract posts on or after 1 July will have their contract pay fixed at the grade and step of the National Pay Scale 2026 corresponding to the grade and step at which they drew basic pay immediately before retirement.

In special cases, the notification said, the pay for a contract post will be the amount determined by the government or fixed by mutual agreement in the contract signed with the government.

Under the third decision, the fixed gross pension (the amount before commutation or surrender) and any special additional pension will not be deducted from the pay fixed for contract service.

Another decision states that no increment, gratuity or enhanced pension will be payable for the period of contract service.

For contract appointments of people other than retired government employees, the terms relating to pay and allowances will be settled case by case on merit through coordination between the Ministry of Public Administration and the Finance Division, and contracts will be signed accordingly.

The notification further said that the relevant parts of all earlier orders or memoranda that conflict with it will be treated as cancelled, while earlier memoranda consistent with it will remain in force.

In the final decision, the government said this notification was issued cancelling the Finance Division notification of 26 January 2016, and it will be deemed to have taken effect from 1 July.