Jagdeo evades questions on pay hike, wage negotiations for public servants

Jan 24, 2022 News

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Kaieteur News- Vice President Bharrat Jagdeo last week evaded questions on whether his government will negotiate with the trade unions before awarding pay increases.
Last year, the government was pilloried for offering public servants a meager seven percent without meeting with the workers’ representatives. With the Natural Resource Fund (NRF) Act already in play the People’s Progressive Party (PPP) government has given itself the green-light to touch the revenues garnered from oil and gas, as was anticipated by the Political Opposition.
In fact, Jagdeo has already signaled that the oil money will indeed be included in this year’s Budget, which is to be presented in the National Assembly on Wednesday. But even though the largest political opposition party, the People’s National Congress Reform (PNC/R) Leader, Aubrey Norton has made recommendations to government for Budget 2022, Jagdeo has labeled the party’s requests as laughable when it comes to the reduction in taxes.
During his interview with NCN on Friday last, the Vice President said “I find it very funny that they would even have a single proposal to suggest now but I guess when…we could have made a lot of suggestions because we were opposed, you would recall we were opposed to all these taxes going on because they were not there before”.
In one instance, Jagdeo cited the increase in taxes to miners, which the PPP opposed when on the opposite side of the Parliamentary benches. This position by the then Opposition Party, he boasted, would have allowed for the then Coalition government to reduce those taxes. According to Jagdeo, “I find it very strange that one of the big areas is taxation that a Party that just demitted office 18 months ago, that has sought to put taxes on every single area, increased taxes by about $40 billion more on basic food items, on medical supplies, on everything, would now have any proposal for a Budget that seeks to reduce taxes”.

Nevertheless, he hinted that the administration may address matters on the tax threshold, a suggestion that was made by the PNCR Leader. Two weeks ago when Norton hosted his weekly Press Conference he suggested that the income tax threshold be increased to $1.5 million or one third of gross earnings, “whichever is higher, from the present $780,000” and that changes be made in the Income Tax Law to ensure that the minimum wage is never taxed. Norton also said that the income tax rate should be restructured to “the first $3 million of chargeable income 15 percent, the next $3 million 20 percent and the balance 25 percent”.
When it comes to a recommendation made by the Leader of the PNCR with regard to food security, Jagdeo said his call was “hollow”.
The VP reasoned that the former government, of which Norton is tied to, had increased water charges, as well as agricultural land charges and drainage and irrigation costs. “If you put the 14 percent VAT (Value Added Tax) on the tractors and combines, you increase the price for d&I charges, you increase price for lease rentals for the agricultural sector, you put a VAT on the input like the pesticides and fertilizers, how you gonna have food security? And that is what they did. We removed all of those,” he said.
Although the VP would have responded to the suggestions made by the PNCR with regard to taxation, he did not throughout his almost one hour interview, make reference to provisions for public servants, who were forced to accept a meagre seven percent increase last November, when his administration sidelined Unions and imposed the highly criticized “increase”.
The announcement meant that a minimum wage Public Servant formerly earning $70,000 in Guyana would receive a $4,900 increase, before taxes, while a Minister of the Government earning $869,000 will receive an increase of $60,830 to their monthly salaries.
Commentators argued that the increase would not have made a difference to minimum wage workers, who are already feeling the nasty brunt from the inflation rates. Moreover, the Guyana Teachers Union (GTU) as well as the Guyana Public Service Union (GPSU) which represents a majority of public servants said in a statement “Their (government’s) actions constitute a violation of Article 147(3) of the Constitution of the Cooperative Republic of Guyana, Section 23 (1) of the Trade Union Recognition Act 1997 and the International Labour Organization Convention 151 which was unanimously ratified by the Parliament of Guyana and currently in force, and is the legally binding Agreement between the GPSU and Government of Guyana for the Avoidance and Settlement of Disputes”.
The Guyana Trades Union Congress (GTUC) also registered their dismay over the government’s imposition of the wages increase, without consulting with the various Unions. “Teachers and public servants are represented by unions, viz, the Guyana Public Service Union (GPSU) and Guyana Teachers Union (GTU). Consistent with International Labour Organisation Conventions Nos. 87, 98 and 151; Article 147 of the Constitution of Guyana; and Section 23(1) of the Trade Union Recognition Act, the employer, who is the Government of Guyana, is duty bound to engage in collective bargaining with the respective unions,” the GTUC had noted.

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