(Barbados Nation) Roughly 3 000 public sector employees will be on the bread line next year, while high-ranking Government officials will be taking a pay cut.
Those were two of the cost saving measures announced by Minister of Finance Chris Sinckler yesterday in a Ministerial Statement in Parliament.
Sinckler said the Democratic Labour Party government was trying to plug a gap of Bds$143 million annually including Bds$34 million in the last quarter of the year.
As a result, 3 000 public servants, both from central government and statutory corporations will be going home next year in two tranches.
The first 2 000 will go in January 15, followed by 1 000 on March 1. In addition, the service will be trimmed by a further 500 through natural attrition like retirement.
Sinckler said all Members of Parliament, permanent secretaries and personal assistants were taking a ten per cent salary reduction.
Additionally, all Minis-tries have been instructed to cut travel budgets by 50 per cent immediately.
Key sections of Sinckler’s presentation follow:
“Information supplied by the Ministry of the Civil Service indicates that there are 16 956 Public Sector posts in central government and another 9 000 spread across the various Statutory Corporations. In the general service 15 333 posts are established and I 623 are temporary posts.
“Further, there are 5 341 temporary employees in the public service composed of 1 082 in temporary posts and 4 177 in established posts. Some 70 public sector posts are filled with contract workers, another 72 listed as “Apprentice” and 80 persons working on a part-time basis…
“With these in mind and based on a proposed saving of approximately Bds$143 million dollars in a full financial year or roughly Bds$35 million over the last quarter of the current financial year, we have estimated that it will affect 3 000 employees across the overall public service: central government and statutory entities.
“We have agreed that, if possible, there should be an even split in the proposed retrenchments between central government and statutory entities but, if not possible, then a split of 2 000 from the general service and 1 000 from the statutory entities would be imposed.
“We further propose that the process of retrenchment be spread over the period January to March 2014, and be front-loaded starting with the first 2 000 job cuts by January 15, 2014, followed by the second tranche no later than March 1, 2014.
“Additionally, Cabinet has agreed to institute a strict programme of attrition across the central public service, filling posts only where it is absolutely unavoidable, over the next five years, ending 2018-2019.
“This attrition is expected to reduce central government employment levels from approximately 16 970 to 14 612 jobs – a projected loss of 2 358 posts; and savings of Bds$121 million. Over the current 19-month adjustment period public sector employment will be reduced by an additional 501 jobs with a projected savings of 26 million dollars.
“We have also agreed that effective January 1, 2014 there shall be enforced a freeze on the payment of increments for the next two years. Appropriate arrangements will be made for this loss of income to be properly factored into the computation of overall pension benefits…
“The Ministry of Finance has also been mandated to work with the Board and Management of the National Insurance Scheme to ensure appropriate provisions are made for timely and full payment of unemployment benefits to workers that are displaced.
“Cabinet has also agreed to support following additional measures:
A 10 per cent cut in the salaries of all Ministers, Government MPs, Parlia-mentary Secretaries, Per-sonal Assistants, and other persons designated as “political appointees” in the employ of the government.
A 50 per cent cut in the external travel budgets of all ministries, and statutory boards.
A freeze on all non-statutory discretionary waivers unrelated to the earning and/or direct saving of foreign exchange for the next three years. It is projected that this measure could save the government at least 100 million dollars over the period.
“Additionally Mr Speaker, earlier this year, the Ministry of Finance formally requested technical assistance from the IMF’s (International Monetary Fund) Fiscal Affairs Department in two critical areas of government’s operations: Tax administration, and fiscal/operational reform in the key statutory entities which rely on central government for large transfers for their operations…
“In 2014, from the government’s side, we are set to initiate a set of major public sector investments either directly on our own or in PPP (Public Private sector Partnership) arrangements. We are confident that if such investments are matched by investments from our domestic and foreign investors that 2014 will truly begin a substantial turnaround in the Barbados economy. Now is the time to forge ahead with those plans and I encourage our colleagues in business to match us in this regard.
“In this way we will create newer more sustainable private sector jobs to assist in redeploying those whom we now have to release from the employ of government to the private sector.
“It is never easy for any government or Minister of Finance to have to introduce measures that strike at the heart of a person’s financial and social livelihood. This is tough on all of us over here and it will be on all officers of the governmental system.
“We understand and empathize with the anguish which these measures will cause the many people affected by them. They will be your constituents and ours. But having tried our utmost over the past five years and some to avoid this road, the exigencies of the negative impact of the world’s worst recession have dictated that we cannot continue on the course which we have been pursuing.”
