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Lower allowances for public sector - Peart

STATE MINISTER for Finance Michael Peart allowances in the public sector will be "rationalised" in a bid to cut the current $35 billion Government wage bid.

"Wages constitute a significant portion of the budget. In fact, public sector wages now stand at approximately $35 billion or 34 per cent of the recurrent budget..." the State Minister said during his contribution to the 2000/2001 Budget Debate in the House.

"The process has already begun. Action will continue to be taken to reduce the number of allowances and the costs involved," he said.

In addition, Mr. Peart said leave arrangements would be reviewed in keeping with present day standards and practices, and that productivity and pay based on performance would be addressed.

The Government revealed in March that it planned to spend $167 billion this fiscal year, approximately $10 billion more than last year, with debt gobbling up almost 60 per cent of the money.

Debt-servicing accounts for $97.5 billion or 59 per cent of the total amount in the Estimates of Expenditure.

About $95.2 billion will be spent on wages, interest payments and other housekeeping or recurrent spending, a 1 per cent increase on the revised estimates of spending tabled a week ago.

The Government expects to spend $71.5 billion, a 4 per cent increase, on one-off and special capital projects and loan repayments.

The total Budget is a 5.6 per cent spending rise over the revised Estimates and is slightly ahead of Dr. Davies's medium-

term projections for inflation, which see consumer price rises falling to between three and four per cent in fiscal year 2000/2001.

The State Minister noted that it was of critical importance that the wage bill be held within sustainable parameters and the low inflation model being pursued by the government maintained. "In keeping with these imperatives, the current trend in wage increase must be the norm over the current contract period," he added.

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