Shaw says Gov’t Ready to Discuss Wage Freeze

KINGSTON – The Government says it is now in a position to fully engage public sector leaders on issues relating to the outstanding seven percent salary increase owed to civil servants.

Opening the 2011/12 Budget Debate at Gordon House on Thursday (April 28), Minister of Finance and the Public Service, Hon Audley Shaw, said this decision follows consultations between Government officials and the International Monetary Fund (IMF) on the matter

He stated that in recent discussions with public sector leaders, it was intimated to them that the Government would consult with the IMF, with a view to reducing the length of the wage freeze and how to treat the arrears.

"The Financial Secretary recently held these consultations and reported to Cabinet on Tuesday of this week. Accordingly, the Government is now in a position to fully engage the public sector leaders, as to precisely how the wage issue can be resolved," he said.

Mr. Shaw pointed out that the Government was cognizant of the "difficult times" which public sector workers have faced consequent on the institution of the freeze on April 1, 2009.

"It is well known that (the) wage freeze was…scheduled to last for three financial years, to March 31, 2012. We must point out, however, that even while we have had a wage freeze in the public sector, it is not an absolute freeze, as the usual increments, averaging 2.5 per cent of the wage bill, have been honoured over the past two years," he explained. He noted that these increases amounted to $3 billion.

The Finance Minister pointed out, however, that any solution must be affordable and "not undermine the hard-won gains" made in stabilizing the economy.

 He added that it must also take into account the provision in both the International Monetary Fund (IMF) agreement, and the Government's fiscal responsibility framework, to reduce the public sector wage bill/GDP ratio.

He said that discussions will be scheduled with public sector leaders, immediately after the close of the Budget Debate.

"I must stress, however, that the country is not out of the woods yet, and there needs to be a spirit of goodwill and compromise of give and take, as we enter, in earnest, into those discussions," Mr. Shaw emphasized.

By DOUGLAS McINTOSH, JIS Reporter