Kathmandu: The administration led by Prime Minister Balendra Shah is set to introduce a special voluntary retirement program aimed at trimming the bloated administrative structure and providing a dignified exit for long-serving civil servants.
This strategic move to resize the national bureaucracy is a core component of the upcoming budget for the fiscal year 2026/27.
Finance Minister Dr Swarnim Wagle, who is scheduled to present the annual fiscal speech to the Federal Parliament today, has reportedly secured the necessary funding to implement this initiative.
According to sources within the Ministry of Finance, the budget includes specific provisions for the additional expenditures required to facilitate those opting for retirement in accordance with the Civil Service Act.
This initiative aligns with the Prime Minister’s firm policy of cutting administrative overheads, a priority since he assumed office. Under this reform agenda, the government has already successfully consolidated the cabinet by reducing the number of ministries from 22 to 18, while dozens of redundant departments and offices are currently being dissolved.
The Voluntary Retirement Scheme (VRS) is being deployed as a tactical tool to manage the surplus workforce created by these organizational closures and to ensure a more agile civil service.
Ministry officials indicate that the scheme will be specifically available to employees aged 50 and above who have already met the requirements for pension eligibility. To incentivize the program, the government plans to offer significant benefits, including the addition of up to seven years to a staff member’s total service duration for the purpose of pension calculations. Furthermore, those opting for the voluntary exit will be granted a one-level honorary promotion at the time of their retirement, ensuring they leave the service with increased benefits and status.
Comment Here