Gov’t may retrench workers to reduce fiscal deficit

By Admin Wednesday June 25 2014 in Caribbean
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CASTRIES: The ruling St. Lucia Labour Party (SLP) is supporting efforts by Prime Minister Dr. Kenny Anthony to reduce the EC$76 million (One EC dollar=US$0.37 cents) fiscal deficit by cutting public service salaries and introducing a wage freeze for the next triennium.

 

Both proposals were rejected by the public workers last week, but the government has been seeking public support for its initiatives to deal with the financial situation.

 

SLP chairman, Dr. Julian Hunte, has reaffirmed his party’s support for the government’s proposals, saying the move is necessary to rescue the country falling into worse economic strain.

 

Dr. Hunte said that government’s actions were an indication of its commitment to the country as it seeks to save it from “the economic crisis it has inherited” and other contributing factors.

 

“The simple and harsh fact confronting us is that if action is not taken at this time, to reduce the deficit in government’s finances, then the economic situation will worsen and St. Lucia will be forced to implement unpalatable and even more austere measures imposed by insensitive, soulless international institutions. This must be avoided.

 

“The situation facing the government is not difficult to understand. It is comparable to that of the head of a household who has recognized that the household expenditure is surpassing the total income earned by the household, and that as a result it is in deep debt. It would then be natural to remove the debt and discontinue it from (repeating). The minister of finance, as head of the household, which is the public service, must therefore cut down on the areas of expenditure which have and are pushing the government into further debt. The largest of these areas is public sector salaries and wages,” he said.

 

Hunte labelled the government’s salary cut proposal as both pro-worker and pro-country measures which were “forced upon the government” by circumstances and said that it is important that the population sees this move as a sacrifice which workers have to make for themselves and country.

 

“If the reality of a five per cent salary cut is worked out in dollars and cents for each individual in the public service, it will be found that the actual amount each public servant is being asked to forego, to safeguard the jobs of all public servants, is small in context of their gross salary; but it is this combined small sacrifice of each person that will save the country,” he said. “What is important is that it is a united effort by all.”

 

He called on opposition parties to provide “alternatives and credible solutions” to government’s proposal “since the situation requires responsible action by all concerned”.

 

Hunte said he also welcomes government’s ongoing consultations with stakeholders.

 

Following the talks with trade union leaders last week, Dr. Anthony said in response to the rejection of proposals by public service unions, his administration will have to go back to the drawing board and put all options on the table.

 

Anthony had previously ruled out retrenchment as the way of reducing the deficit, saying it was not his intention to send any public servants home. However, he said government had no choice but to consider all options since the proposal was rejected.

 

“Going back to the drawing board means that all things are on the table, for example we have been talking about reduction in wages, retrenchment, additional taxes, all of those things will have to come back on board,” he said.

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