Civil Service Bill caught between Parliament and ordinance

KATHMANDU, Sept 28: With Parliament’s current session set to end within a week, uncertainty is mounting over the fate of the Federal Civil Service Bill, with questions growing over whether the long-pending legislation will clear the regular legislative process or be introduced through an ordinance.

At the center of the uncertainty is a controversial provision that would require civil servants to retire compulsorily at the age of 55 or after completing 30 years of service.

The Public Service Commission (PSC) has objected to the proposed “55–30” rule, as well as provisions related to pensions. “If the bill is introduced through an ordinance, the PSC’s objections will make little difference because its opinions or recommendations are not binding,” said a senior official at the Ministry of Land Management, Cooperatives, Federal Affairs and General Administration. “However, the Chief Secretary, Law Secretary and most senior officials oppose bringing the bill through an ordinance.”

A provision that could reshape the bureaucracy

Under the proposed 55–30 rule, employees who reach 55 or complete 30 years of service would be compulsorily retired on a one-time basis. For employees with more than 30 years of service, pensions would be calculated on the basis of 30 years of service.

According to sources, the PSC concluded that the one-time retirement provision is inconsistent with national and international practices, existing laws and the Constitution. It has also rejected the proposed pension provision.

After conducting a two-week study, the PSC sent its opinion to the government last Friday.

MoLCFAGA Secretary Madan Bhujel said he was unaware of any plan to introduce the bill through an ordinance. “The process is currently moving forward as a bill,” he said.

But a MoLCFAGA official said the ordinance option had not been ruled out. “Preparations for it also appear to be underway,” the official said. “The entire bill could be introduced as an ordinance, or only the 55–30 provision could be introduced by amending certain Nepal laws through an ordinance.”

According to the official, the decision could come quickly after the parliamentary session ends. “If an ordinance is to be issued, it will come within a week after Parliament’s session ends. If not, it could take five or six months. But the 55–30 provision will be introduced,” he said.

Concerns over a sudden loss of senior officials

The proposed provision has raised concerns within the bureaucracy, particularly over the number of senior officials who could be forced to retire at once.

A senior official at the Ministry of Physical Infrastructure Development warned that the government could end up weakening the civil service by introducing the provision without adequate preparation or an assessment of its impact.

“By retiring many senior officials, the government is trying to fill positions such as director general and secretary through lateral entry. That would destroy the civil service. The chain of command would collapse, affecting public service delivery and development projects,” he said.

A Prime Minister’s Office official disputed the concern, saying the provision would not destabilize the bureaucracy. “Employees who reach the age limit will retire and young people will get opportunities,” he said.

Sources said Chief Secretary Govinda Bahadur Karki and Law Secretary Parashwor Dhungana are also dissatisfied with the provision. If implemented immediately, only five or six of the 59 serving secretaries would remain in office, while the rest would be required to retire. Home Secretary Kedar Sharma and MoLCFAGA Secretary Bhujel would also be affected.

Pension question

The government has also sought to address concerns over pension benefits for employees affected by the proposed retirement rule.

A senior MoLCFAGA official said the bill submitted to the PSC provides for pension benefits to be calculated on the basis of 58 years of service for employees who retire before reaching 55 under the 55–30 provision. “Therefore, employees will not lose the benefits they are currently receiving if the provision is implemented,” he said.

The Ministry of Law, Justice and Parliamentary Affairs has already agreed to the 55–30 provision, while the Ministry of Finance has given its consent to the bill twice.

If the bill is endorsed by the Office of the President in its current form, employees who reach 55 or complete 30 years of service will be compulsorily retired. More than 13,000 employees are estimated to be affected. The government is estimated to need more than Rs 25 billion in grants for the retiring employees.

Eight years, but no civil service law

The uncertainty comes after years of attempts to enact a federal civil service law.

The government has been trying to introduce the Federal Civil Service Act for the past eight years, but the legislation has remained stalled amid legal and policy disputes.

Now, with the parliamentary session nearing its end, the government faces a choice between pushing the bill through Parliament and taking the ordinance route—while the proposed 55–30 rule continues to divide officials and raise questions about its impact on the country’s bureaucracy.