The finance ministry has instructed the state owned enterprises (SOE) to review and propose salary revision for its employees.
Unlike the last salary revision where SOEs were issued with a guideline specifying the maximum and minimum salary for each grade, this time the ministry has only asked the companies and its board to be mindful of the affordability. This is to ensure that the pay raise will be financed from the SOE’s revenue.
“Apart from providing clear rationale, the company and the board must be mindful of the nature, scope and complexity of the company functions while proposing the pay structure,” a letter from the finance ministry stated.
However, sources from the ministry said that this letter does not apply to the Druk Holding and Investments (DHI) and 19 companies under its umbrella. DHI is an investment arm of the government which holds the ownership of critical companies. According to a source, DHI has its own procedure and guideline to revise the salaries of its employees.
One of the outcomes of the finance ministry’s review on the SOEs is that companies with social mandate would be held with the ministry while others would be transferred to the DHI.
As for the SOEs under the finance ministry, the department of macroeconomic affairs has also attached a format of the proposal to be submitted to the ministry.
The format specifies the salary structure according to grade with inclusion of other allowances like corporate allowance, house rent allowance, communication allowance, banking allowance, among others. In the proposal companies could propose a basic pay structure for every grade and new allowances.
There are 17 companies owned by finance ministry. SOEs constitute a vital component of the Bhutanese economy and play strategic role in providing infrastructure and public service. It contributes almost 40 percent of the domestic revenue, including the taxes and employees about 13,000 people
Meanwhile, salary and allowance of Royal Bhutan Army and Royal Body Guard have also been revised effective from July.
Sources said that the lowest ranked armed personnel is now drawing a salary of about Nu 19,000, an increase of about 10,000. The revision in the higher ranks, lieutenant colonel and above is an increase of about Nu 30,000 to Nu 40,000.