No more crazy sac­ri­fices

Jamaica Gleaner - - IN FOCUS - Dr Myr­ton Smith is pres­i­dent of the Med­i­cal As­so­ci­a­tion of Ja­maica. Email feed­back to col­umns@glean­erjm.com and myr­ton­smith@hot­mail.com.

THERE HAVE been re­peated ut­ter­ances in the pub­lic space re­gard­ing the pub­lic-sec­tor wage bill. In those dis­cus­sions, the pub­lic sec­tor is spo­ken about as if the work­ers rep­re­sent a yoke around the neck of Gov­ern­ment that is al­most sin­gle-hand­edly hold­ing back our eco­nomic growth. It is time that the dis­cus­sions take a dif­fer­ent turn.

The pub­lic sec­tor must be seen for what it is. It is not an inan­i­mate ob­ject. It is a term that de­scribes thou­sands of hu­man be­ings who work tire­lessly, for long hours, and for a salary that is a mere frac­tion of what many could earn work­ing in the pri­vate sec­tor or in other coun­tries. They work as the arms of gov­ern­ment that de­liver the ser­vices that a Gov­ern­ment must de­liver to the peo­ple – health care, ed­u­ca­tion, se­cu­rity. They are the col­lec­tors of the all-im­por­tant taxes that are used to fi­nance many of the ser­vices that our peo­ple en­joy. They carry out the re­search that forms the ba­sis for many of the poli­cies of gov­ern­ment and that pro­vide guid­ance on draft­ing legislation.

The pub­lic sec­tor has re­peat­edly been asked to make sac­ri­fices for the sake of Ja­maica. For the ‘greater good’. Gov­ern­ment has re­peat­edly placed strict lim­its on the level of in­creases to be granted to pub­lic-sec­tor work­ers, un­like pri­vate-sec­tor work­ers. This has re­sulted in a widen­ing in the gap between the rich and the poor or mid­dle class, as Orville Tay­lor sur­mised in his Gleaner ar­ti­cle of March 10, 2013. The first mem­o­ran­dum of un­der­stand­ing (MOU) was signed in 2004 im­pos­ing a wage freeze on pub­lic-sec­tor work­ers for two years in ex­change for “job re­ten­tion”.

Dur­ing this time, as part of the agree­ment, the Gov­ern­ment was to main­tain in­fla­tion rate be­low 9% or pub­lic-sec­tor work­ers could rene­go­ti­ate. Of course, the Gov­ern­ment failed to meet its in­fla­tion tar­get. In­fla­tion from June 2004 to June 2005 was 17.5% (ac­cord­ing to STATIN). The dol­lar de­val­ued and the pub­lic debt in­creased, squan­der­ing the sac­ri­fices of the pub­lic sec­tor. No rene­go­ti­a­tion oc­curred. In­stead, we had three other MOUs re­strict­ing the wages of pub­lic-sec­tor work­ers.

The time has come for public­sec­tor work­ers to be given the recog­ni­tion that they are due be­cause with­out them, the en­gine of gov­ern­ment would grind to a halt.

We agree that the pub­lic ser­vices need to be mod­ernised and be­come more ef­fi­cient in the process of ser­vice de­liv­ery. To achieve this, four strate­gic goals have been iden­ti­fied. These are: en­hanc­ing ser­vice de­liv­ery; im­prov­ing gov­er­nance and ac­count­abil­ity; man­ag­ing for re­sults; and im­prov­ing change man­age­ment and com­mu­ni­ca­tion.

But since the pub­lic sec­tor is not a ma­chine that can be sim­ply traded for a new one, ‘mod­erni­sa­tion’ in­volves the con­tin­ued train­ing and re­train­ing of pub­lic-sec­tor work­ers. It in­volves find­ing ways to at­tract the best and the brightest to work in the pub­lic sec­tor. This will re­quire that the Gov­ern­ment in­vest in the sec­tor.

TACKING WAGE BILL

The pub­lic-sec­tor wage bill, it has been ar­gued, must be re­duced to 9% of GDP or less. There are a few ways to do this: 1. Cut the num­ber of public­sec­tor work­ers. a. This may well have the ef­fect of lead­ing to a con­trac­tion of gov­ern­ment ser­vices. This means longer wait­ing times in ar­eas where ser­vices must be de­liv­ered by an ac­tual per­son such as in health care. Some ser­vices may be de­liv­ered elec­tron­i­cally, which may im­prove ef­fi­ciency, but we must re­main vig­i­lant for cy­ber theft or hack­ing. b. This dis­place­ment could well re­sult in an in­crease in the al­ready high un­em­ploy­ment fig­ures. It would be a rip­ple ef­fect as pub­lic-sec­tor

The pub­lic sec­tor has re­peat­edly been asked to make sac­ri­fices for the sake of Ja­maica. For the ‘greater good’. Gov­ern­ment has re­peat­edly placed strict lim­its on the level of in­creases to be granted to pub­lic-sec­tor work­ers, un­like pri­vate-sec­tor work­ers. This has re­sulted in a widen­ing in the gap between the rich and the poor or mid­dle class ... .

work­ers, in turn, em­ploy other per­sons as nan­nies, do­mes­tic helpers, and gar­den­ers. We should also bear in mind that pub­lic-sec­tor work­ers re­main a re­li­able source of in­come tax un­der the PAYE sys­tem. 2. Di­vest some of the ser­vices cur­rently de­liv­ered by Gov­ern­ment into pri­vate hands. This might never oc­cur un­less the in­vest­ment cli­mate is im­proved. 3. Cut wages or salaries of the pub­lic sec­tor. This would rep­re­sent in­hu­mane pun­ish­ment for work­ers who have en­dured at least six years of wage freeze and re­duc­tion in ben­e­fits such as leave en­ti­tle­ment, pen­sion ben­e­fits, gra­tu­ity, and health­in­sur­ance cov­er­age. 4. Grow the econ­omy and in­crease the GDP so that pub­lic-sec­tor wages be­come a smaller per­cent­age of GDP.

This MUST be the goal of gov­ern­ment as our growth is cur­rently very anaemic. The pub­lic-sec­tor work­ers are po­si­tioned to be an in­te­gral part of the growth agenda if given the nec­es­sary sup­port. We have ar­rived at this point in our his­tory be­cause of many years of mis­man­age­ment of our coun­try – fi­nan­cial waste in gov­ern­ment, run-with-it poli­cies, and cor­rup­tion. We ap­plaud re­cent at­tempts to be more fis­cally pru­dent, but it is in­ap­pro­pri­ate to serve the pub­lic sec­tor up as the sac­ri­fi­cial lamb once again.

As the IMF and the vo­cal mem­bers of the Eco­nomic Pro­gramme Over­sight Com­mit­tee push Gov­ern­ment to cut the pub­lic-sec­tor wage bill while mov­ing to in­crease jobs, they must be clear what they would want the Gov­ern­ment to do. They must also pro­vide so­lu­tions for deal­ing with the con­se­quences of those ac­tions.

Pub­lic-sec­tor work­ers must also be in­cluded in the dis­cus­sion if har­mony is to be main­tained.

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