An APNU+AFC Govt. can and will provide an immediate wage increase

May 07, 2015 Letters

DEAR EDITOR,
Politics is about simple thing and when the APNU+AFC wins the elections, thousands of people will have a better life immediately. Why? Within the first 100 days, the APNU+AFC will provide an immediate wage increase for all classes of workers of 10 percent; across the board.
The APNU+AFC has also committed to providing policemen with a special package of 20 percent within the first 100 days. All of this will be done before collective bargaining negotiations with the unions commence. Under an APNU+AFC Government, Guyana must return to a period of collective bargaining with the unions.
It is puzzling to note that Mr. Jagdeo claimed that this payout by the APNU+AFC will cause massive inflation. Any proper finance expert or economist will reject such lunacy since Guyana’s inflation rate is influenced by many factors, not just increase in wages. Plus any skilled financial administrator will know that a combination of monetary and fiscal policies can act as inflation-reduction tools to cool off the economy when needed.
But the critical empirical evidence to debunk this piece of voodoo economics from Mr. Jagdeo is the actual performance of the economy when the Armstrong Arbitration Award instructed a payout to the workers of 58 percent increase in salary over two years in 1999. What was the state of the inflation in 1999 and 2000 when this material salary increase was granted? Let this IMF report be our guide – (https://www.imf.org/external/np/sec/pn/2000/pn00102.htm).
The bump in inflation was not double digits when we has such a material increase, so why would a 10 percent increase in wages cause runaway inflation as Mr. Jagdeo is projecting? Where did he and Donald Ramotar learn their economics again?
Now to the real crux of the matter. How much would this proposed APNU+AFC package cost and how it will be funded?
First off, this is expected to cost about G$7.5 billion a year in the first year. Rationalizing how we procure goods and services under the current budget can easily fund most of this increase. In 2014, the actual current expenditure was reported to be some G$85 billion. Once the public procurement commission is established we expect that the cost of procuring goods and services will be reduced by as much as G$6-7 billion which will be redistributed to the workers.
As an example, if we are to review and re-negotiate how we procure medical supplies, one would find that we can save immediately G$800 million. Clearly we cannot have the Government purchasing drugs from a preferential supplier for many times its real value. We cannot have any Government carrying on with the transfer of the people’s wealth to the private pockets of any cabal and their best friends for services not rendered. This was the case under the PPP for the last 10 years.
Do we need 102 luxury-type vehicles assigned to Government Ministers and certain Head of Departments? All of them fully paid for, maintained and serviced by the taxpayers? It cost over G$800 million to procure and maintain this fleet for the PPP fat cats. That can easily be cut in half and redirected to the workers. Then there is the international travel bill by the Cabinet Ministers pegged at over G$1.1 billion which can also materially be reduced. Then there is shaving of the army of PYO activists on contract to the State to conduct PPP party work in the fields on taxpayer dollars – costing the Treasury more than G$400 million every year. These are just a few of the many tools that can be used to fund that much deserved pay increase for the workers.
If we are to review how we procure good and services across the current budget using a professional team at the Procurement Commission, headed by a seasoned and skilled financial administrator like Mr. Anand Goolsarran, we can save this country billions out of the current budget alone, which will then be redirected to paying the workers more and taking them closer to a living wage.
Under the APNU+AFC Government it can and it will be done. So cut the fear mongering Mr. Jagdeo, no one is buying these half truths anymore!
Sase Singh

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