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'If I were minister'... Shaw tells how he would treat wage dispute

Published:Tuesday | May 19, 2015 | 12:00 AMDaraine Luton
Audley Shaw, opposition spokesman on finance.

Arguing that the Government has been lukewarm in its approach to public-sector reform, the Opposition, Jamaica Labour Party (JLP), said that the reason a better wage offer cannot be made to workers, is that the public sector is too large.

Audley Shaw, the opposition spokesman on finance, said the Government should have removed 10,000 public-sector workers from the system, consistent with a recommendation made in 2010, and this would have put them in a better position to make better wage offers.

Shaw, who served as finance minister from 2007 to 2011, said that, were he minister, he would cut the public sector by 10,000 workers, "not by firing public sector workers, but by carefully analysing the utility and usefulness, of every position once somebody has reached retirement".

The Government is currently in negotiations with public-sector workers for a new wage contract, for the 2015/2017 contract period. But facing a target of nine per cent of GDP by next year, the Government has said it cannot offer more than a five per cent increase.

Shaw, however, said the public-sector workers should "reject the offer outright", and has told The Gleaner that, if he were minister, he would not be in the position where he is only able to offer five per cent.

"They have not followed the advice of the Public Sector Transformation Unit. There is no deliberate, planned and structured programme along the lines that was recommended by the Public Sector Transformation Unit", Shaw said.

There are approximately 112,700 persons working in the public sector, 60 per cent of whom worked in the ministries of education, health and national security.

Merger and privatisation

The Patricia Sinclair McCalla-led Public Sector Transformation Unit, in 2010, recommended that the merger and privatisation of several public-sector entities, as well as the reduction of the public-sector work-force by 10,000 persons over five years, would have, when fully implemented, resulted in $40 billion to $50 billion in savings for the country.

Shaw said he would have used attrition to reduce the size of the public sector "by carefully selecting which post we would continue to fill and which post we would retire".

"If you were doing that, and each year you are doing that aggressively, you (would) have less people to pay, and, therefore, you could pay the workers more. And on top of that, if I was there, I would be growing the economy," Shaw said.

Under its agreement with the IMF, Jamaica must reform its public sector to, among other things, reduce the public-sector wage bill to meet the nine per cent target, which has been deferred by a year, to next year.

Among the strategies being employed to attain the target is the elimination of 7,000 posts from the civil-service establishment. About 3,000 posts were eliminated in 2012. In 2013, another 3,000 were removed, and 1,000 which became vacant were not filled.