Following the introduction of a new Civil Service Act by Prime Minister Balendra Shah’s government, resignations among civil servants in Nepal have surged. Employees, including high-ranking officials up to joint secretaries, are resigning due to dissatisfaction with the proposed law and recent transfers.
The bureaucratic circle appears alarmed by the leadership style of Prime Minister Shah, who took charge on March 27, 2026. Since then, the Department of National Personnel Records (Civil) has registered resignations from 6 joint secretaries and 17 under-secretaries.
The primary cause of panic is the proposed "30-55" provision in the draft bill. The government reportedly plans to set the retirement criteria at either 30 years of service or an age limit of 55, replacing the current 58-year age limit which lacks a service-year cap.
Employees who have served over 30 years or are nearing 55 fear that service beyond 30 years will not count toward their pensions, significantly reducing their post-retirement benefits. An under-secretary who recently resigned explained that staying under the new rules could result in a 14% financial loss in pension calculations.
Consequently, civil servants are racing to resign before the Act takes effect. Sudan Khwakhali Shrestha, Director of the Department of National Personnel Records, confirmed a sharp increase in resignations, with 135 employees stepping down by June alone. Remarkably, 584 resignations have been recorded in the three months since the current government took office, compared to around 700 during the entire previous year.
This mass departure comes despite recent government incentives, including a 21% salary hike, income tax exemptions, bi-monthly salary payments, and a two-day weekend. However, fears over future financial security and ongoing structural reforms—such as reducing the number of ministries from 22 to 18 and dissolving certain departments—have outweighed these perks.
Officials note that even more resignations are expected after July 16, as many employees are waiting for the newly hiked salaries to be officially factored into their lifetime pension calculations.
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