Bahamas public servants to see pay raises and expanded health coverage

Bahamas Prime Minister Philip Davis has announced salary increases for middle management public servants to take effect at the end of June, with broader raises between two to eight percent for the remainder of the public service coming in September 2025. He also unveiled plans to expand health insurance coverage for all government employees.

During his contribution to the 2025/2026 budget debate in the House of Assembly yesterday, Mr Davis said the government had completed the first phase of its salary review, which focused on middle management and above.

“This second phase will bring salary adjustments of two to eight percent for the remainder of the public service, a vital step to help restore purchasing power lost to inflation while also promoting fairness, retention, and morale across the public sector,” he said. “The second phase will be implemented in September 2025.”

The announcement was met with loud cheers and desk-thumping from government members in the House.

Mr Davis also confirmed a significant upgrade in employee benefits, stating:

“We are also expanding the health insurance coverage for all government employees. This initiative will provide broader protection for our public officers, reduce out-of-pocket medical costs, and improve overall access to healthcare for those who serve our nation.”

He reiterated that the prescription drug benefit will be moved from the National Insurance Board (NIB) to the National Health Insurance (NHI) programme. This transition will be supported by an upgraded IT system aimed at enhancing efficiency, ensuring private insurers meet obligations, and easing pressure on the public purse.

The announcements follow the Davis administration’s commitment last year to address low public sector wages. At that time, $10 million was allocated to the Ministry of Finance for a comprehensive salary review covering sectors like education, healthcare, law enforcement, and customs.

The nation’s wage bill had risen to $629 million, driven largely by union agreements, employee promotions, and classification reforms. Additionally, the Ministry of Labour and Public Service conducted its first service-wide promotional exercise in over nine years in July 2023, at a cost of $18 million.

Mr Davis’ latest update underscores his administration’s pledge to invest in the nation’s public workforce while promoting long-term sustainability and improved service delivery.