The government is of the view that across-the-board payments for public sector employees contributes to the blurring of salary scales and widens the gap in public sector wages and salaries.
In this regard, Government has proposed differentiated salary increases.
According to Minister of Finance Winston Jordan, “It’s about wages, allowances, merit increment and also de-bunching so some people will end up getting even more because to de-bunch you may have to give one increment or two increments. It’s an entire package.”
As the negotiations between the government and the union continue, he noted that “the union asked for across- the-board (increases), we said we are not going down that road. I don’t know whether the union has accepted it or not.”
“What I’m saying is that across- the- board has widened the divide, it has literally destroyed scales and all these things. I give you 40 percent across the board, you are earning $1M, the increase is $400,000. I give you the same percent increase, you are earning $100,000, how much is the increase? Look at the gap,” Minister Jordan explained.
He added that an offer was made to look at the allowances as soon as salary negotiations are completed.
“I agree with all the unions and so on to make a big pitch for their workers, but at the same time policy makers have to be wary of what it would do to the broader macro-economic fundamentals of the country, especially competitiveness, and its impact on inflation and exchange rate deterioration. All of that could retard growth and at the end of the day, instead of promoting welfare, it can reduce welfare of the citizens,” Jordan pointed out.
The minimum wage for public sector employees is $50,000 while that set for private sector employees is $35,000.
Minister Jordan said the time has come for the private sector’s minimum wage to be revisited also.
(GINA)
