Sun | May 28, 2017

Editorial: Create public-sector facilitation indices

Published:Sunday | August 30, 2015 | 8:00 AM

Now that the Simpson Miller administration, but for the obstinate holdouts in security and health care, has largely completed its wage negotiations with state employees, it is hopefully ready, after all the talk, for a serious overhaul of the public sector, whose poor performance, by most accounts, is a major constraint to growth in the Jamaican economy.

We do not imply that nothing has changed in the economic environment. Over the past three and a half years, much has been. Indeed, the administration has displayed a level of fiscal discipline that was mostly lacking for 40 years and which drove the country into a spiral of borrowing, debt, low investor confidence, and little growth, while it maintained a public sector that was largely unproductive and inefficient.

For while comparative nominal employment numbers may protect Jamaica's public sector from claims of bloat, its wages, at around 11 per cent of gross domestic product (GDP) - it used to be nearly 13 per cent - consumed more of national output than most economies worthy of being benchmarked against. There are two immediately relevant factors around this.

One is that as distended as Jamaica's public-sector wage-to-GDP ratio has been, it was kept in check for the better part of a dozen years by wage freezes, including a just-ended one that lasted four years. Second, as public commentators increasingly note, this ratio is distorted by the prism of the country's relative poverty.

In other words, the public sector is not overstaffed or its employees overpaid. Rather, national output remains too low. In that context of service-delivery demands, it is held, it would be counterproductive to cut the estimated 15,000 jobs that would have been required if the Government, without abandoning its

fiscal programme, acquiesced to wage demands of 30 per cent, but from which most unions retreated.

bloated central bureaucracy

Public-sector managers, of course, will have a hard task convincing Jamaicans that they are not being forced to sustain a bloated central bureaucracy, even if people are sympathetic that a major part of the problem is the employment imbalance: too many workers, including many who are unproductive, in some areas, and too few in others. A reform project will significantly tackle this issue, even if it leads to no net change to overall job numbers.

But the more fundamental issue is about transforming the public bureaucracy into one that sees itself as the vanguard of a facilitatory State, acting in partnership with the private sector in the promotion of investment, job creation and economic growth, rather than purveyor of policy and regulatory humbug.

Policy leadership to create a new public psychology is, in this regard, important. So, too, will be investment in training, the recruitment of technically competent staff, and a greater utilisation of technology.

But these, this newspaper believes, must be underpinned by new forms of accountability and different approaches to remuneration of staff. It might achieve this with the creation of facilitation indices, by which government ministries, departments and agencies are consistently measured for their service delivery, as well as provide a platform for performance-based pay for employees.

If they perform well and the economy grows, more taxes will be collected. Even if they are paid more, their emoluments will, in time, account for less than the 37 per cent of all taxes they now consume.