Chattogram City Corporation and WASA face Tk 450 crore burden

The approval of the new national pay structure has put Chattogram City Corporation (CCC) and Chattogram Water Supply and Sewerage Authority (WASA) under financial pressure. The two agencies will have to spend an additional Tk 450 crore to pay the salaries and allowances of their officers and employees. Both institutions are financially weak.

An analysis of the budgets of the two institutions shows that only a nominal amount remains as a surplus after covering their full year operating expenses. Even that amount is spent on repaying debts. Against this backdrop, Chattogram City Corporation may have to increase holding tax and WASA may have to raise water prices to meet the additional salary and allowance costs.

However, officials of the two agencies said the additional expenses would be covered by increasing revenue rather than putting an additional tax burden on city residents.

Another statutory institution, the Chattogram Development Authority (CDA), is in a comfortable position in this regard. Although its salary and allowance expenses will increase by Tk 24 crore under the new pay scale, it has a strong fund of around Tk 900 crore.

The government approved the new pay structure for government employees last Monday. Under the new structure, basic salaries will increase by 100 to 142 percent depending on the grade.

CCC faces Tk 350 crore burden

An analysis of the Chattogram City Corporation budget shows that the city corporation earned Tk 1,665.92 crore in the 2025 to 26 fiscal years. Its expenditure was also almost equal to its income. There was no surplus. The corporation spent Tk 332.24 crore on salaries and allowances for permanent and temporary officers and employees. Of this amount, Tk 246.70 crore was spent on salaries and allowances for permanent officers and employees. If salaries increase by 100 to 142 percent under the new pay scale, CCC will need an additional Tk 246 crore to Tk 350 crore for salaries. Its total salary and allowance expenses will rise to Tk 682 crore at once.

However, as the city corporation has no surplus fund of its own, it will not be possible for it to meet this huge additional expense. The city corporation mainly depends on holding tax, service fees and government grants to meet its expenses. To manage the additional costs, it will need government block allocations. Otherwise, it will have to increase its own holding tax and service charges.

According to the proposed budget for the 2026 to 27 fiscal years, the city corporation has set its total proposed budget at Tk 2,260.24 crore. Of this, Tk 480.85 crore has been allocated for salaries and allowances for officers and employees. Tk 165 crore has been allocated for basic salaries. The city corporation has around 8,000 permanent and temporary officers and employees.

Mohammad Humayun Kabir Chowdhury, chief accounts officer of the city corporation, said, “Keeping the announcement of the pay scale in mind, an additional Tk 150 crore has been allocated in the budget for salaries and allowances. The exact increase will be known once the full gazette is issued. The salaries and allowances of the city corporation’s officers and employees are paid from the revenue sector.”

SM Sarwar Kamal, chief revenue officer of the city corporation, said, “We are already collecting Tk 264 crore in fair taxes from the port. At the same time, we have sent letters to bring 36 container terminals under holding tax. We expect to collect at least Tk 120 crore in revenue from there. In addition, the tax assessments of various government institutions have not been properly evaluated. We will reassess them and collect fair holding tax. If these revenues are collected, we expect to collect around Tk 500 crore. Then there will be no problem in meeting the additional salary and allowance expenses.”

WASA faces Tk 86 crore burden

An analysis of the Chattogram WASA budget shows that WASA earned Tk 336.88 crore in the last fiscal year. Its expenditure was Tk 302 crore.

Although Tk 34 crore remained in the organization’s account, WASA has debts of around Tk 16,000 crore. Therefore, it has no real surplus. According to the budget for the 2025 to 26 fiscal years, the autonomous agency spent Tk 67.59 crore on salaries and allowances for its officers and employees. If salaries increase by 100 to 142 percent according to different grades, the agency’s total salary and allowance expenses will rise to Tk 154 crore at once. As a result, WASA will need an additional Tk 86.32 crore just to pay salaries and allowances. WASA has 1,570 permanent and temporary officers and employees. The agency also has an obligation to repay large amounts of loans taken against its long-term projects. Therefore, it will either have to increase water prices or receive government subsidies to meet the additional expenses.

Chattogram WASA Managing Director Engineer Selim Md. Zane Alam said, “We plan to meet this expense not by increasing water prices but by collecting outstanding bills and reducing water wastage. The highest amount of outstanding bills was collected last month as well. In addition, water supply is being increased. This will also expand the billing coverage.”

CDA comfortable with strong fund

The situation is completely different for the Chattogram Development Authority (CDA). The agency earned Tk 122 crore in the 2025 to 26 fiscal years. Its expenditure was Tk 75 crore. It had Tk 47 crore in savings. It spent Tk 19.37 crore on salaries and allowances. If salaries increase by 100 to 142 percent across different grades, salary and allowance expenses will rise to around Tk 43.39 crore. The additional expense will be Tk 24.06 crore. CDA has around Tk 950 crore deposited in its fund.

Anisul Haque Patwari, finance and accounts officer of CDA, said, “The impact of the additional salary and allowance expenses will not have much effect on CDA’s treasury.”

Meanwhile, a CDA official who spoke on condition of anonymity said, “Plans are being taken for various income generating projects including a flat project for expatriates to meet the additional salary and allowance expenses in the long term.”