'Do not expect a Cadillac lifestyle in a Volkswagen economy':
Public Service not neglected
--Dr Nanda Gopaul
Guyana Chronicle
June 13, 2004

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A GINA Feature - The Public Service may not offer one of the most lucrative jobs, but it certainly has benefits. Government has come in for severe criticism from the Guyana Public Service Union (GPSU) alleging that the sector has deteriorated under the current Administration.

These criticisms were particularly heightened by Union President Patrick Yarde recently. The GPSU is celebrating 81 years of existence, but as Head of the Public Service Dr. Nanda Kishore Gopaul explained during an interview, real wages and working conditions have never been better.

Tracing the pattern of public service development can best be explained by the cliché, " You cannot expect a Cadillac lifestyle in a Volkswagen economy," Gopaul said.

Wages in Guyana had significantly declined and had been seriously undermined during the 1970s and it is against this background that progress can be talked about today.

The People's Progressive Party/Civic assumed Office in 1992 and at that time the minimum wage of a public servant in Guyana was $3137. The minimum wage in Guyana at present is $22,099.

The GPSU membership has benefited tremendously in recent years from a deliberate policy on the part of the Government to reverse the steady decline in real public sector wages brought about by the policies of the previous Government.

At the beginning of 1989, the minimum wage in the public sector was $595 or US$59.50 under the fixed exchange rate regime that obtained at that time. The rapid deterioration in the official exchange rate saw the minimum wage fall to US$25.98 by the end of 1990. The minimum wage declined in 1991 to US$13.78. This grossly depleted minimum wage of public servants was restored in 1992 to US$25.08.

The wages as they are now also include substantial increases of nearly 65 per cent for the years 1999 and 2000.

As explained by Dr. Gopaul, the positive effects of the steady increases in nominal public sector wages on the disposable incomes of public servants is further consolidated by the recent success in bringing inflation under control. He noted that annual inflation has been reined in from consistent double-digit levels in the 1980s to consistent single-digit levels since 1992. In 2001, the inflation rate through prudent management of the economy was restricted to 2.6 per cent. Inflation between 1999 and 2003 rose by 31.8 per cent, while there was economic growth over that same period of about 4.4 per cent, with negative growth rates on two occasions only. Wage increases for that period was 73.22 per cent, marking a tremendous increase in real terms.

According to Dr. Gopaul, the combination of rapid and steady increases in nominal public sector wages, and success in restraining inflation and deterioration in the exchange rate has resulted in public servants being decidedly better off, relative to their status in the 1980s and early 1990s. These policies and increases implemented by Government debunk the claim of discrimination against public servants.

Responding to claims by the Guyana Public Service Union that the sector has reached rock bottom under this Administration, Dr. Gopaul noted that real wages and working conditions of public servants have consistently increased. He referred to the 1980s when Professor Clive Thomas said that 'Never in the history of the Guyanese workers, was there that extent of devastation to their real wages.' The Working People's alliance, an opposition political party described the 1980 Budget as 'draconian.'

The Public Service Head also noted that workers' allowances have improved over the years. There have also been technological advances within the public sector that make life easier for employees. With the pending implementation of the Pubic Sector Modernisation Programme between Government and the Inter-American Development Bank, the public sector will be further improved.

Public Servants benefits vary depending on the categories. However the allowances paid to them are for motor car; meals; overtime; away from base; one month leave passage; annual leave ranging from 14-42 days; duty free concessions for public servants with travelling posts; sick leave entitlement, which is being abused by many public servants and special leave to attend to personal business and academic commitments. Public Servants also work less than the average working week of 40 hours - 37 1/2 hours per week. They also work up to 15:30 on Fridays.

Given the volatility of the country' economy, as in any developing country, Government can offer super salaries to public servants, but the current package can contest remuneration at some private sector agencies.

The danger also of significantly raising wages and creating expenditure that the economy cannot afford is causing erosion of real wages, as the currency would lose its value.

Even though public servants may work hard and deserve high increases, there are other social factors that could hamper this, as Government cannot borrow money to pay wages.

Dr. Gopaul acknowledged that there is room for improvement, but noted that this had to be incremental in relation to the country's economy. He also commended hardworking public servants.

The traditional public service comprised some 30,000 employees. However many agencies have been given semi-autonomous status by the Administration and many workers are now employed on a contractual basis. This has resulted in a public service population of 10,000. However, Government has not retrenched public servants.

Below is table of public servants minimum wage from 1980 to 2003.


(D/M/Y) Monthly wage

(G$) Per cent increase Exchange Rate

(G$/US$) Monthly Wage

(US$) Pre cent increase

1/1/1980 258 2.55 101.17

1/1/1981 271 5 3 90.30 10.79

1/1/1982 271 0 - 90.30 0.00

1/1/1983 271 0 - 90.30 3.54

1/1/1984 360 32.90 3.85 93.50 1.55

1/1/1985 382 6.10 4.15 92.05 0.99

1/1/1986 401 5 4.40 91.14 37.79

1/1/1987 567 41.30 10 56.70 4.94

1/1/1988 595 4.90 10 59.50 63.65

1/4/1989 714 20 33.01 21.63 20.06

1/8/1989 857 20 33 25.97 10.68

1/1/1990 917 7 39.53 23.20 12.00

1/6/1990 1,027 12 39.53 25.98

1/1/1991 1,541 60 111.80 13.78 46.95

1/7/1991 2,546 65.20 111.80 22.77 65.22

1/1/1992 2,801 125.09 22.39

1/7/1992 1 3,137 23.20 125.09 25.08 12.00

1/1/1993 3,451 130.16 26.51

1/7/1993 2 4,314 27.30 130.16 33.14 25.01

1/1/1994 5,500 27.50 138.23 39.79 20.05

1/1/1995 6,380 16 140.23 45.50 14.35

1/1/1996 7,337 15 141.06 52.01 14.32

1/1/1997 8,804 20 143.65 61.29 17.83

1/1/1998 9,540 163.74 58.87

1/7/1998 3 11,445 30 163.74 69.90 18.72

1/1/1999 15,000 31.06 180.43 83.13 18.94

1/1/2000 19,000 26.66 184.75 102.84 23.70

1/1/2001 20,045 5 189.50 105.78 2.86

1/1/2002 21,047 5 193 109.05 3.09

1/1/2003 22099 5 198 111.61 3.00

1 10.02 per cent increase in January 1992 was subsumed in the 23.20 per cent increase in

July 1992

2 10.01 per cent increase in January 1993 was subsumed in the 27.30 per cent increase in

July 1993

3 9.50 per cent increase in January 1998 was subsumed in the 30 per cent increase in

July 1998

Note: The average year exchange rates were used in the conversion.