Wednesday, May 16, 2018
By KHRISNA RUSSELL
Deputy Chief Reporter
DEPUTY Prime Minister K Peter Turnquest yesterday said the government has no intention to downsize the public sector in response to concerns levelled by the International Monetary Fund (IMF).
However, he did not rule out the possibility of a downsizing exercise as he underscored the Minnis administration has a priority to contain an increase in the overall wage bill.
The IMF has called for the Minnis administration to trim the civil service wage bill to fill the $240m gap needed to meet its Fiscal Responsibility targets.
Asked if terminations could be expected, Mr Turnquest told reporters outside of Cabinet: “No. Certainly not as a result of anything the IMF would have said.
“We are doing our own internal reviews and trying to rationalise for ourselves where we see people and service levels that we need.
“We do not have an intentional plan to downsize but rather note the concerns and acknowledge that we have to contain the growth in the wage bill overall.”
The East Grand Bahama MP further suggested the government has always been aware of the unsustainable public sector work force number.
“This is something that we’ve known since we came to office. We’ve consistently been saying the last administration bumped up the public service to unsustainable levels.
“We have been trying to rationalise the new hires and those on contracts. Those that we can move off of the public payroll in a way that gives those persons involved a safe landing. We are trying to do that.
“We continue to be cautious about hiring and trying to rationalise services trying to move people around in the public service to ensure that we are getting value for money and that people are being productive and have a career path because one of the unfortunate things about these contracts that have been given out in the last administration is that there is no career path for these people. So they were just in low paid minimum wage jobs with no hope of being hired and no future and so we are trying to see if we can restructure some of that, rationalise it and bring the civil service back into some kind of order and put these people in productive positions so that they can have a chance at having long term employment.”
He added: “Others we are trying to train to make sure that the job empowerment programme that was initiated some time ago that that actually becomes effective because it has been at this point just a place to park people to justify giving some service or some contribution.
“We want to make that a true empowerment programme so that people at the end of 52 weeks do in fact have some skill that they can go into the public service or into the private sector and contribute in a meaningful way and build lives for themselves.”
Mr Turnquest was also asked about apparent firings under the Minnis administration.
“You say persons are being terminated, I don’t know that,” he replied.
“I know that there are constantly reviews being done, that there are contracts that are coming to an end all the time. Some are being renewed depending upon the need of the various ministries and agencies. I suspect that will continue.”
However, he could not say how many people this continuous process could affect.
“These are very careful decisions we make based upon human resources recommendations and the needs within these different ministries and agencies.”
The International Monetary Fund (IMF), in its newly-released Article IV report on Monday suggested that further sacrifice was required for the Government to hit its fiscal consolidation goals even though its 2017-2018 targets were “within reach”.
The Fund “urged” the Minnis administration to further cut recurrent spending, which goes on fixed costs such as civil service salaries and rents, and avoid “an undue squeeze” on capital spending on essential infrastructure - the very method by which it has narrowed the 2017-2018 deficit.
The Government’s Fiscal Responsibility Bill, unveiled yesterday, seeks to cut the fiscal deficit to 0.5 per cent of gross domestic product (GDP) within three years. But the IMF warned it might miss this target without its recommended Budgetary ‘adjustment’.
“The fiscal target for fiscal year 2018 is within reach, despite the unbudgeted purchase of [Bahamas] Resolve promissory notes, although at the expense of lower-than-budgeted capital spending,” the IMF said.
“Staff recommended an additional adjustment of 2.25 per cent of GDP to bring the deficit to 0.5 per cent of GDP by fiscal year 2021- the medium-term target under the proposed fiscal rule - to put the public debt-to-GDP ratio on a firmly downward trajectory.
“Staff urged the authorities to identify measures to undertake this adjustment, with a strong focus on reducing current spending and avoid an undue compression of capital spending.”