Roberts, left, and Jones
Dionne Rose, Staff Reporter
WHILE SOME public sector workers are complaining bitterly about the Memorandum of Understanding (MoU), union representatives have expressed no regrets about putting their signatures to that document.
The MoU was signed last year between the Government and the Jamaica Confederation of Trade Unions (JCTU), to save the budget and jobs of public sector workers through a two-year wage restrain.
The unions maintain that the MoU was one of the best decisions made at the time despite recent price increases.
"Absolutely not!" said Danny Roberts, vice-president of the JCTU, last week when asked by The Sunday Gleaner if he had any regrets in signing the MoU.
"We signed the MoU because we were convinced that further increases in the budget through wages could lead to significant loss of jobs in the public sector," he explained.
"Over the last 15 years, we have seen rationalisation of the public sector, which has led to loss of jobs, but nothing has occurred in terms of greater level of efficiency," he said.
Wayne Jones, president of the Jamaica Civil Service Association who committed more than 15,000 public servants to the MoU, also has no regrets.
"The MoU has provided more successes than failure. It came out of a need to preserve some 15,000 jobs and these include low-level workers, including clerks, cleaners and cashiers," he said.
"They would have been subjected to the axe. I have no remorse in signing the MoU because we (the JCTU) saved in excess of 15,000 jobs," he said.
Under the MoU, the Govern-ment agreed that it would manage its economic policies by ensuring that the inflation rate remained within the targeted band of eight per cent to nine per cent in 2004/05 and six to seven per cent in 2005/06.
The Government was also expected to maintain real gross domestic product (GDP) at two per cent to three per cent in 2004/05/06.
As it relates to inflation, the Statistical Institute of Jamaica reported that inflation for the month of July was 1.6 per cent, up from 1.5 per cent in June.
The 12-month point-to-point inflation to July 2005 stood at 18.2 per cent. Meanwhile, the inflation rate for calendar year 2004 was 13.7 per cent.
EXTERNAL FACTORS
Mr. Roberts, however, stated that the ballooning of the inflation figures was not solely to be blamed on the Government, as there were external factors.
"There have been extraneous factors, which have contributed to the spiralling of inflation. We had natural disasters, which would have contributed not only to inflation movements, but real GDP growth," he said.
But two factors have cast a shadow on the MoU, he said. These are the movement in the general consumption tax and bus fare increases.
"Those two factors are factors which the Govern-ment had direct control over, one could argue, and which have affected us negatively," he said.
Despite these draw backs, however, both Mr. Roberts and Mr. Jones pointed out that the MoU is not only focused on wage restraints and price controls, but also encourages efficiency and productivity at the enterprise level and training of staff.
Mr. Jones revealed that under the MoU, some 5,000 public sector workers were trained during last year and this year.
These were public servants at the lower levels, such as ancillary staff in the public sector who were exposed to other skills, such as entrepreneurship training, including floral decoration, tiling skills, cake baking, pastry making and computer skills.
Mr. Roberts said another success of the MoU was that it provided an opportunity for the unions and the Government to engage in a bipartisan process that encouraged social dialogue.
But would they enter into another MoU with the Government? "It would be foolhardy of us if we said to the world that we would not sign another MoU. An MoU is as good as its content," said Mr. Jones.
"What we have said and maintained is that this body will not sign any agreement that will put the restraints on wages as this MoU did," he added.
"The context in which this MoU was created and the opportunities that it provided for the governance structure, for the human resource management capability and for efficiency, are things that we want to preserve in a future MoU," said Mr. Roberts.
"But there can be no consideration given to any restraint on the wage aspect of a future MoU," he said.
... Remove tax on uniform and laundry, says RobertsDANNY ROBERTS, vice-president of the Jamaica Confederation of Trade Unions has recommended an immediate removal of the tax on uniform and laundry allowances, to cushion the recent price increases.
Mr. Roberts made the recommendations during an interview with The Sunday Gleaner last week.
"You get a tax free amount of $739 for uniform and $395 for laundry, after that it becomes taxable. They need to remove the tax from laundry and uniform immediately and that will benefit private sector workers as well," he said.
INCOME TAX THRESHOLD
Mr. Roberts has also recommended that the tax threshold that will be increased in January be fast tracked and implemented in October this year.
The income tax threshold was increased to $169,104 per annum, last month, the first of two tranches intended to move taxable income to $193,440 by 2006.
This means that workers earning $169,104 or less will not pay income tax.
Minister of Finance and Planning, Dr. Omar Davies had announced the hike in his April 14 Budget speech, saying it was based on the recommendations of the tax review committee chaired by Joseph Matalon.
Effective January 1, 2006, the threshold will be further lifted to the target figure of $193,440.
An increase of 1.5 percentage points in the general consumption tax, moving from 15 per cent to 16.5 per cent, announced by Dr. Davies in the budget speech as part of his tax reform package, took effect on May 1.
- D.R.
