Subvented agencies to be weaned off government payroll
Government is to wean off some 12 state-subverted agencies that have been identified to have the capacity to generate enough revenue to provide for personal emoluments and administration of those institutions.
To this end, measures and modalities are to be established to assist those institutions to be independent of government’s financial support.
This was disclosed by the Finance Minister Seth Terkper when he presented the 2014 budget and economic policy to Parliament on Tuesday.
The move forms part of strategies to rein in the bludgeoning public sector wage bill following the implementation of the Single Spine Pay Policy (SSPP), which government claims is throwing it fiscal policy off-balance.
The Minister said that despite the challenges posed by implementation of the SSPP, government remained committed to the policy and is working in concert with stakeholders to address issues of sustainability of the new pay regime.
In the first three quarters of 2013, the exchequer expended 74.4 per cent of tax revenue and 96.5 per cent of non-earmarked tax revenue on the compensation of employees’ including arrears on compensation.
The Minister said there was urgent need to keep the wage bill with overall budget constraints to allow for the use of the taxpayers’ funds for other developmental needs, noting that government would bring the judicious allocation of the nation’s financial resources to bear on negations on pay regimes.
Other measures government is considering to bridle the wage bill is the establishment of an Employee Compensation Unit at the Budget Division of the Ministry of Finance to deal with all compensation issues including those related to wages and salaries, allowances and pensions, social security, and gratuities.
From 2014, ministries, departments and agencies as well metropolitan, municipal and district assemblies would seek authorization and clearance from the Finance Ministry before recruitment and replacement of staff.
As such, heads of institutions who fail to adhere to the directive would be sanctioned.
Mr Terkper said government would implement the white Paper on market premium without further delay and that from January 2014, the existing interim market premium paid to some workers will be abolished and replaced by premiums determined in consonance with the white paper.
Government has thus directed the Fair Wages and Salaries Commission (FWSC) and the Ghana Statistical Service (GSS) to undertake a labour market survey to inform the determination of critical skills in short supply, starting with the health and educations sectors.
The Minister said as part of the measures to put a leash on the escalating public sector earnings, the FWSC and the Public Services Commission and the Management and Productivity Institute will expedite action on modalities for the introduction of the Public Service-Wide Performance Management System.
Also, the categories of allowances in the public service, especially the categories two and three, would be streamlined, harmonized and standardized to bring sanity into its administration. Existing and new allowances would be executed based on approved budgets of MDAs.
Mr Terkper said government would also ensure the efficient, effective and lawful use of Internally Generated Funds (IGF) by state institutions and organizations who flout the law governing the use of IGFs would be sanctioned accordingly.
He said the capacity of the public services would be strengthened to ensure effective service delivery, adding that, the PSC has been mandated to build a human resource data base of government employees to facilitate effective control of the entry and exit of workers into public institutions.
This will enable government constantly review staff ceilings and mandates of institutions to identify overlap of functions.
This year’s budget aims to strengthen revenue collection, control public sector wage spending, modernize agriculture, manage the country’s debt burden prudently and realign national expenditure towards priority programme, as well the establishment of a fund to boost infrastructural development.