JIS News

The Memorandum Of Understanding (MOU) signed between the Government and the Jamaica Confederation of Trade Unions (JCTU) representing public sector workers can be described as a significant achievement. The agreement involves a wage restraint of three per cent for the period April 1, 2004 to March 31, 2006.
The signing of the MOU will save the Government $5 billion in expenditure on wages in 2004/05 budget. The wage restraint will enable the Government to hold wage expenditure at the same level as the 2003 /04 budget, and will result in savings of 1per cent of the Gross Domestic Product (GDP).
Minister of Finance and Planning, Dr. Omar Davies said this was why the agreement with the unions “cannot be underestimated and why it is so critical to Jamaica’s development.”
Two successful initiatives by the Government – the signing of the MOU with the unions and the raising of loans from the Bank of Nova Scotia and Deutche/Commerzbank – will result in reduction of expenditures in the budget of some $13 billion.
Under the MOU, wage contracts to come into effect during the period April 1,2002 to March 31, 2004 and for which there have not yet been any arrangements (with respect to increases) are to be settled strictly within a wage bill increase of three per cent.
Wage contracts that are to come into effect during the period April 1, 2003 to March 31, 2005 are to be settled strictly within a wage increase of three per cent. For the period April 1, 2003 to March 31, 2004 except where offers above three per cent are on the table, the current offers on the table are deemed to be the final offers and the contracts will be concluded on that basis.
Government has guaranteed that it will manage its economic policies in order to ensure that the inflation rate remains within the Government’s targeted band of eight per cent to nine per cent in 2004/05 and six per cent to seven per cent in 2005/06.
The Government will also pursue policy to generate a fiscal deficit in the range of three per cent to four per cent in 2004/05 and a balanced budget in 2005/06.
Dr. Davies hailed the social partnership talks with trade unions and the private sector, saying they were the most important developments in the economic life of Jamaica since Independence.

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