Proposed Federal Civil Service Bill could force retirement of 13,000 employees, Open door for external appointments

KATHMANDU: The government is preparing a major restructuring of Nepal’s federal civil service that could result in the compulsory retirement of nearly 13,000 civil servants at once, while also introducing provisions that would allow qualified professionals from outside the bureaucracy to enter senior administrative positions.

According to a draft of the proposed Federal Civil Service Act, employees who have reached the age of 55 or completed 30 years of service would be required to retire through a one-time transitional arrangement. After the implementation of this provision, the mandatory retirement age for civil servants would be set at 60 years.

If endorsed by Parliament, the proposal would trigger one of the largest workforce restructurings in Nepal’s public administration history, affecting officials from the highest levels of government down to support staff.

Majority of Secretaries Set to Leave

The draft indicates that 52 of the government’s current 65 secretaries would be forced to retire under the proposed criteria, leaving only 13 serving secretaries in office.

At the joint secretary level, an estimated 180 officials would retire due to the age limit, while another 88 would leave after completing 30 years of service. Nepal currently has around 610 sanctioned joint secretary positions.

Similarly, 501 under-secretaries would be retired based on age, with another 259 affected by the 30-year service provision. At the section officer level, 560 officials would retire due to age and 363 because they have completed the required service period.

The impact would be even greater among assistant-level employees. Government estimates suggest that 2,154 assistants would retire because of age limits, while another 1,947 would leave after completing 30 years of service.

Overall, preliminary calculations indicate that around 13,000 civil servants could exit the federal bureaucracy if the proposed law is enacted in its current form.

Significant Fiscal Burden

The mass retirement plan is also expected to create a substantial financial obligation for the government.

Under existing laws, retiring employees are entitled to accumulated leave payments, medical benefits, gratuities, and other retirement-related facilities. Officials estimate that each employee may require between Rs 2 million and Rs 2.5 million in retirement-related payments.

Based on those estimates, the government could face an immediate financial liability of approximately Rs 25 billion to manage the transition.

Proposal for Lateral Entry into Senior Bureaucracy

Another notable feature of the draft legislation is a proposal to allow appointments to senior administrative positions, including secretary and joint secretary posts, from outside the traditional civil service structure.

Sources familiar with the draft say the government intends to create a mechanism through which individuals with relevant qualifications, expertise, and professional experience could be recruited competitively for fixed-term assignments in senior government roles.

The provision, included in a draft prepared by the Ministry of Federal Affairs and General Administration, would permit the recruitment of qualified professionals from the private sector, academia, development organizations, and other professional fields for positions requiring specialized expertise.

Government officials argue that such a system would help make the public administration more professional, efficient, results-oriented, and accountable.

However, the proposal has generated mixed reactions within the civil service. Many career bureaucrats have expressed concern that allowing external appointments to top positions could limit promotion opportunities and affect the career progression of long-serving government employees.

Draft Under Review

The draft Federal Civil Service Act has been forwarded to the Ministry of Law, Justice and Parliamentary Affairs for review. Following legal scrutiny, it will be sent to the Public Service Commission for feedback and recommendations.

After incorporating the commission’s suggestions, the bill is expected to be submitted to the Cabinet before being registered in Parliament.

The long-awaited Federal Civil Service Act has been a key component of Nepal’s federal governance framework since the implementation of federalism. The latest proposals have already sparked extensive debate within government circles, with supporters highlighting the need for administrative reform and critics warning of institutional disruption and financial costs.