On 29 November 2014, the Government announced a five per cent increase in the wages and salaries for public servants earning in excess of $50,000 per month and an eight per cent increase for those earning less than $50,000, retroactive to 1 January 2014. There was, however, no consultation with the Guyana Public Service Union (GPSU) before the increases were agreed upon, contrary to the collective bargaining agreement signed on to by the Government with GPSU. The failure to involve the workers’ representatives, and the imposition of arbitrary increases, have been a regular feature of the Administration since the mid-1990s.
Salary increases and the National Budget
In the past, increases in wages and salaries were met from the line item – Revision of wages and salaries – in the Ministry of Finance’s budget. Following the dispute last year between the Government and the Opposition over the quantum of the increase that the National Assembly had approved vis-à-vis the payments made, the Government this year changed the description of the line item to “Other employment costs”.
It will be useful to recall what happened last year. The Assembly had approved the sum of $4.404 billion as revision of wages and salaries, which worked out to a 15 per cent increase. The Government, however, paid out only five per cent. This prompted protests from the Opposition and the Guyana Public Service Union (GPSU). The Government’s explanation was that the amount approved did not only relate to salary increases but also the employment costs for new recruits and salary increases for promoted employees.
In a previous article on the matter, I had argued that this explanation appeared not to have merit since every year the Assembly approves of revised staffing tables for Ministries, Departments and Regions. It is from these tables that the employment costs are arrived at, after taking into account the latest wages and salaries increases. The additional cost relating to promoted staff members would have also been reflected in the budgetary amounts. In addition, no Ministry, Department or Region can recruit persons beyond the authorized staffing that Assembly has approved. In support of my argument, I had done an analysis of the budget of the Office of the President which showed clearly that the wages and salaries for new recruits were reflected in that office’s budget.
The following table shows the increases of wages and salaries for the period 2008 to 2014. (Since the additional increase of three per cent for employees earning below $50,000 per month is not likely to have a significant impact on the total wage bill, it is not taken into account the table.)
Analysis of increases in wages and salaries 2008-2014
An examination of the audited accounts of the Ministry of Finance for 2011 and 2012 shows that the entire amounts budgeted for in respect of the revision of wages and salaries were expended. Information as regards expenditure for 2013 is not yet publicly available, since the Speaker of the Assembly was unable to present the Auditor General’s report to the Assembly. This was because of the prorogation of Parliament. Nevertheless, given past trends, in all probability the entire amounts budgeted for in 2013 and 2014 would have been expended. This would mean that for 2014, $1.606 billion (excluding the three per cent referred to above) would be paid out, compared with $4.409 billion, a difference of $2.803 billion.
For the period 2008-2014, the difference would amount to $13.722 billion. Regrettably, the Auditor General’s reports for 2012 and earlier years have not shed any light on the matter, as they are devoid of any findings relating to employment costs at the Ministry of Finance, including the expenditure under the line item for revision of wages and salaries. In the circumstances, taxpayers are left to wonder what the cumulative amount of $13.722 billion was used for.
Timing of salary increases
The National Budget for 2014 was passed in April 2014, but the Government has once again chosen to grant the salary increases close to the festive season. This practice has been the pattern of the present Administration for a number of years. Under the Hoyte Administration, the increases took effect as soon as the budget was approved. This was a logical approach and reflected good governance practice. The only plausible explanation for the current practice is that public servants would be more or less inclined not to quibble over the percentage increase but would rather be happy to receive an accumulated sum to coincide with the festive season. This practice also has the effect of undermining the Union’s ability to bargain for higher increases.
If one were to consider employees who have barely enough income to meet their basic living expenses, they will feel the effects of inflation as early as in January. Heavens knows how they are able to meet the five per cent shortfall during the first eleven months of the year. For those who are fortunate enough, remittances from overseas will save the day for them. Having received this accumulated increase in December, if they fritter it away to enjoy the Christmas season, they will be in no better position financially in the beginning of the New Year. This is not to suggest that citizens do not have the right to enjoy the festive season.
Quantum of the increase
Salary increases are usually offered as a minimum to cushion the effects of inflation. In his 2014 Budget Speech, the Minister of Finance stated that inflation was expected to be five per cent. Therefore, there is no real increase, except for employees earning less than $50,000 per month. It would have been more appropriate for all employees to enjoy a real salary increase in view of the current level of emoluments of public servants in the authorized establishment, as opposed to contracted employees. Indeed, the latter category will also enjoy the five per cent increase, which in some cases will exceed the monthly salaries of those earning less than $50,000 per month.
Union’s reaction
The Government’s announcement was met with protests from the GPSU which gave the Government a 48-hour ultimatum to reconsider the adequacy of the increase, or face industrial action. GPSU is demanding an interim increase of eight per cent pending further negotiations. It argued that the collective bargaining process is legally binding, and to the extent that it is not being honoured, the right of public service servants is being trampled upon. GPSU also stated that renewed attempts to initiate negotiations were repeatedly brushed aside by the Public Service Ministry. In addition, GPSU indicated that it had written to the European Union (EU) about two months ago requesting its intervention, as the Government has failed to honour provisions of the Cotonou and Economic Partners Agreement between the Region and the EU.
Government’s explanation
The Head of the Presidential Secretariat acknowledged the need to adhere to the collective bargaining agreement. He, however, contended that negotiations have consistently failed to yield a reasonable outcome, and that, in view of the deadlock, the Government was once again forced to intervene to offer relief to public servants. He also averted to the question of affordability of increases beyond the single digit.
Opposition’s reaction
The main Opposition party, APNU has condemned the Government for arbitrarily increasing wages and salaries for public servants. In a public statement, it demanded that the Administration respect the collective bargaining agreement with the GPSU and enter into a sincere and serious negotiations with the Union aimed at paying reasonable and meaningful increases to public servants. APNU also called for an immediate review of the conditions under which public servants work with a view to offering “a living wage”. It also stated that public servants are frequently unable to afford to meet some basic household expenses and often are forced to borrow money for emergencies and to settle day-to-day expenses. APNU further stated that the Administration must adhere to the International Labour Organization conventions ratified by the Assembly.
Conclusion
It is unfortunate that the Government continues to ignore the pleas of the Union for better wages and salaries. One hopes that it will reconsider its position and offer an eight per cent across-the-board, and a further three per cent for those earning less than $50,000 per month, as an interim measure pending further negotiations. If such negotiations fail, the matter should then be referred to arbitration. After all, public servants keep the engine of government spinning, and a highly motivated workforce is indispensable for upholding good governance practices, and the highest degree of transparency and accountability, so badly needed at this time.
On a final note, over the last six years or so, the Disciplined Services enjoyed one month’s salary, tax free, as a Christmas bonus in addition to the normal across-the-board increases. There has been no announcement so far this year. The payment is likely to be quietly made, given the level of dissatisfaction with the proposed five per cent increase. Are other public servants also not deserving of a Christmas bonus? One is left to wonder as to the real reason for preferential treatment being given to the Disciplined Services.
(The author can be contacted at goolsarran@yahoo.com)
