By Vernon Daley and Lynford Simpson, Staff ReportersFACED WITH mounting pressure to cut public spending, the Government has pulled together a tight mix of cost-cutting options that include slashing leave for civil servants, plugging loopholes for public waste and merging public companies.
According to the Government, it will save $1 billion this year alone by changing leave entitlements for the just over 42,000 civil servants.
Finance Minister Dr. Omar Davies told Parlia-ment last week that as part of the trade-off for moving the salaries of civil servants closer to those paid in the private sector, the Government has insisted on changes to leave entitlements and improved performance.
Opening the 2003/2004 Budget debate last Thursday, the Finance Minister said "all new entrants to the civil service are being employed with drastically reduced leave entitlements and a clear acceptance that additional increments and promotions are related to their performance and evaluation."
OVER 70 DAYS' LEAVE
Currently, civil servants are entitled to leave which could see them off the job for up to nine weeks per year. Also, they are paid a pension for life after 10 years service, but do not contribute to a pension scheme.
A breakdown of the leave entitlement shows civil servants getting 35 days' vacation leave each year, weekends not counted; 14 days' departmental leave; 14 days' sick leave; and two weeks' recreational leave at the end of a period of study. Wayne Jones, president of the Jamaica Civil Service Association (JCSA), in an interview with The Gleaner, acknowledged that, unlike their colleagues
in the recently-established executive agencies, civil servants do not currently contribute to a pension scheme. Senior civil servants, including permanent secretaries, receive a gratuity at the end of their contract period.
"For the rest of people in Central Government, they do not contribute to their pension," Mr. Jones admitted. This money is paid from the Consolidated Fund. A formula is used to determine the amount each person is paid. "One reckons that it comes out at anywhere between 66 2/3 per cent and 75 per cent of your present income," said Mr. Jones.
TASK FORCE
According to him, the JCSA was not opposed to examining the possibility of moving to a contributory pension scheme. "As long as it can be determined that the benefits are likely to be better than what they at present are," he emphasised.
The controversy surrounding the pension scheme aside, Mr. Jones noted that as part of the plan to tighten spending, the Government will also be setting up a two-man task force that will look at ways to further trim expenses in the public sector, using practices employed in private firms.
The task force, that comprises CEO of Tank Weld, Chris Bick-nell and Patrick Hylton, former managing director of the Financial Sector Adjustment Company (FINSAC), will have full access to procurement procedures and other relevant Government information, Dr. Davies said, just before announcing a new $13.8 billion tax package to help fund the $261.8 billion Budget.
"I have given this task force a minimum target of a one per cent saving for this fiscal year. If this is achieved, this will be a significant step on the way to greater efficiency," the Minister added.
PRIVATISATION AN OPTION
With non-debt spending projected at $90 billion, the Government intends to save roughly an additional $1 billion from the task force's recommendations.
The Government will also be looking to further cut costs through mergers of state agencies and the divestment of others. Among those slated to be merged are the National Investment Bank of Jamaica (NIBJ) and the Development Bank of Jamaica (DBJ). The Finance Minister has asked Professor Alvin Wint of the University of the West Indies to advise him on how to proceed with the merger of the two entities.
"I expect to have this report by the end of April and will be following the recommendations immediately thereafter," Dr. Davies emphasised.
The Minister also said the Government was still considering the option of privatising some Government agencies. He said, however, that very few offers have been forthcoming from the local private sector and in several cases those that are made have turned out to be inadequate.
But with mergers and privatisation come the likelihood of job losses. However, Mr. Jones told The Gleaner recently that this is something that his membership was prepared for. "There will be some job losses," the JCSA president admitted. He said that he would only support staff reduction if it was aimed at making the agencies more efficient and not merely an attempt to slash numbers.
