3,000 Public sector workers to be laid off [in Barbados]
By Keisha Chapman From VOB 929 Barbados
Minister of Finance, Chris Sinckler says staff cuts in the public sector are unavoidable and has announced that 3 thousand employees across the public sector, from both central government and statutory entities – will be laid off early next year.
In a Ministerial Statement to the Parliament this morning, Mr Sinckler said that government will try to ensure that these cuts are made evenly across the central government and statutory boards. But he says that if this is not possible, then 2 thousand of the workers will be laid off from the general service and the next one thousand cuts will take place within the statutory entities.
The first tranche of cuts, expected to be 2 thousand workers – will take place by January 15th 2014.They have also implemented an effective freeze on hiring in the Public Sector for the next five years.
Mr Sinckler added that over the current 19 month adjustment period, public sector employment will be reduced by an additional 5 hundred and one jobs, saving the government approximately 26 million dollars. There will also be a freeze on the payment of increments to public sector workers, effective next month. He noted that consultations will continue with the relevant worker’s unions.
Government has also implemented a 10 percent cut in the salaries of Ministers, government Members of Parliament, Parliamentary Secretaries and anyone considered to be a political appointee in the employment of the government.
Earlier in the statement, Mr Sinckler said despite the implementation of many of the austerity measures announced in the Budget, there continues to be a worrisome decline in revenue. He added that if this trend is allowed to continue, it could undermine the fundamental policies which support the country’s exchange rate.
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Opposition leader slams Barbados government for “ultimate betrayal”
From Caribbean360
PHOTYO: Mottley declared the island in crisis as she criticised the ruling party for its decision to lay off 3,000 public servants early next year.
BRIDGETOWN, Barbados, Monday December 16, 2013, CMC – Opposition Leader Mia Mottley declared the island in crisis as she blasted the Freundel Stuart administration for betraying Barbadians by opting to send home 3,000 public servants next year.
“The decision to remove 3,000 public workers is the ultimate betrayal of the mandate of this government. We have heard over and over ministers say there will be no layoffs, there will be no sell offs before, during or after the election and the prime minister led the chorus,” she told reporters at a news conference on Friday afternoon.
The Barbados Labour Party (BLP) leader warned that the “storm is still coming” and she charged that the measures implemented will not stop the free fall of the Barbados economy.
She maintained the government’s economic policies were ill conceived and suggested that the announcement by Finance Minister Chris Sinckler was nothing more than an attempt to please visiting officials of the International Monetary Fund (IMF) who reviewed the island’s economic performance this week.
“It was not about growth, it was not even about the people who now will not be able to face Christmas with the confidence that they know where their money will come from next year. This was about slowing the process of the International Monetary Fund telling the world what we already knew locally.”
“I say clearly that we do not want in any way to say we told you so because there is too much pain that people will feel from today onwards because Barbados is still in a crisis and more to the point the government of Barbados has betrayed the trust and mandate of the people of Barbados that it received earlier this year,” Mottley said.
The Opposition leader charged that the island is no closer to recovery and she further chastised the government for failing to remedy the crisis it created.
“We will still have an unsustainable deficit after the minister’s speech today. We will still have reserves even after the punitive credit Swiss loan that has now been reduced from five years to three years; we will have reserves that will still go into free fall at the end of the first quarter of next year. We have not addressed any issue of competitiveness, we have not addressed any issues of restructuring government spending or the economy, we have not addressed anything else but above all else there is still no confidence in the Barbados economy but more particularly in the Barbados government.
“There is no one who is going to bring money into Barbados after today’s speech nor will there be anyone who is going to risk their money locally because you cannot see the end in sight. In summary this government faces not only a fiscal deficit but a credibility deficit,” Mottley charged.
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Union to discuss Barbados public sector retrenchments Thursday
From Caribbean 360
The NUPW has kept a stony silence ever since Finance and Economic Affairs Minister Christopher Sinckler announced last week that the government would trim the public service
BRIDGETOWN, Barbados, Monday December 16, 2013, CMC – The National Union of Public Workers (NUPW), which represents the majority of public servants in Barbados, says it will meet with its membership on Thursday to discuss the recent announcement by the government to dismiss 3,000 workers as the Freundel Stuart administration seeks to revive an ailing economy.
The NUPW has kept a stony silence ever since Finance and Economic Affairs Minister Christopher Sinckler announced last week that the government would trim the public service as well as reduce by 10 per cent the salaries of ministers, government legislators, parliamentary secretaries and those considered to be a “political appointee”.
NUPW general secretary Dennis Clarke said that the union would make a statement after it holds the consultation with its members on Thursday.
The government said that the first 2 000 job cuts would take place by January 15, followed by others by March 1.
Sinckler said that the plan to cut public service jobs would result in the government saving as much as DBS$143 million (One BDS dollar = US$0.50 cents) and that the government had also agreed to institute a “strict programme of attrition” across the central public service, filling posts only where it is absolutely unavoidable, over the next five years, ending 2018-2019.
“This attrition is expected to reduce central government employment levels from approximately 16 970 to 14, 612 jobs – a projected loss of 2 358 posts; and savings of BDS$121 million. Over the current 19-month adjustment period public sector employment will be reduced by an additional 501 jobs with a projected savings of BDS$26 million,” he added.
There are approximately 28,000 people employed in the public service and the head of the Barbados Institute of Chartered Accountants (ICAB), David Simpson, said that apart from the retrenchments, the government would still have to outline a plan to stimulate foreign exchange earnings and improve the economy.
“I feel this is just the start. I don’t know what other successes they will have in significantly cutting expenditure in other areas,” he added.
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IMF supports job and pay cuts in Barbados
From Caribbean 360
A statement issued at the end of the review noted that Barbados’ wage bill rose to 10.3 percent of GDP, the highest in the region.
BRIDGETOWN, Barbados, Monday December 16, 2013, CMC – The International Monetary Fund (IMF) has endorsed the decision by the Barbados government to sever 3,000 public servants and implement wage cuts next year.
An IMF team headed by Nicole Laframboise met with government officials, opposition legislators and representatives from the private sector, trade unions and academia as it conducted its 2013 Article IV consultation this week.
A statement issued at the end of the review on Friday noted that Barbados’ wage bill rose to 10.3 percent of Gross Domestic Product (GDP), the highest in the region.
“Staff takes note of the government’s decision to reduce the civil service up front. This will lower spending and send a strong signal about policy commitment, though these workers should have access to unemployment support and programs for re-employment.
“Alternatively, downsizing by attrition and implementing a wage formula that freezes the average wage per worker would also reduce the wage bill significantly over time and would contribute to lowering economy-wide labour costs.”
The IMF mission noted that the Barbados economy continues to face considerable economic challenges and it stressed the need for urgent policy adjustments and deeper reforms over an extended period to restore fiscal and external sustainability.
The financial experts reported that weak exports, low tourist arrivals and slow growth, among other factors, have led to a sharp increase in public debt and they projected that real output is expected to fall by 0.7 percent this year.
“In the external sector, tourism receipts have remained flat and the current account deficit is projected to widen to 11.4 percent of GDP this year. Together with a sharp drop in private capital inflows in 2013, international reserves have fallen this year to US$468 million at end-October.”
“In this environment, the fiscal position has come under increasing strain. The central government deficit is expected to rise to 9.5 percent of GDP in 2013/14 and central government debt had risen to 94 percent of GDP by September 2013.”
The IMF mission stated that while spending cuts outlined in the August budget are broadly on track, tax revenues have been falling short of projections and it recommended an overhaul of the tax system.
The IMF further urged Barbadian authorities to improve the targeting of social spending and lower costs to ensure that Barbados retains its high standards of equity and social protection.
It pointed out that there is some duplication across ministries and some social programs, such as childcare and housing, are not well targeted and may be benefiting middle and higher income groups at the expense of the most needy. Click here to receive free news bulletins via email from Caribbean360.
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