Tuesday, 13 August 2013

Sustainability Of The Single Spine Pay Policy

Perhaps the greatest news that emerged from the National  Forum on the sustainability of the Single Spine Pay Policy in Ho was the fact that government had no intention to scrap the policy which to all intent and purposes had brought some sanity in the administration of public sector pay.  President Mahama who gave the keynote address at the opening of the two day forum made it emphatic that government intends to go along with the policy and therefore charged the Fair Wages and Salaries Commission and the Management Development and Productivity Institute to collaborate with stakeholders to undertake a market survey for effective implementation of the nagging issue of market premium.  

The Single Spine Pay Policy was initiated by the erstwhile Kufuor Administration  to help minimise disparities and distortions that might have hitherto bedeviled the Public Service Salary administration system.  In effect the policy was meant to attract, retain and motivate public sector workers to enhance effectiveness in service delivery for improved productivity.  In recent times however, implementation of the policy has encountered some challenges including labour unrests.  

Salaries and wages have sky-rocketed thereby spiralling the National Wage Bill.  In the 2013 Budget it was projected that the country's GDP base will expand and therefore the Public Sector Wage Bill as a component of GDP will decline serving as a balancing act.  While that argument remains true, all things being equal, the first quarter of  2013 was hit by severe energy crisis which have adversely impacted on GDP growth.  

Recently the IMF cautioned that Ghana's growing wage bill if untamed will increase the country's debt to levels that pose a risk to its transformation agenda.  According to the IMF, Ghana's wage bill rose by 47 percent last year following the implementation of the Single Spine which have seen some salaries being doubled.  It is good government has introduced some new taxes and expanded the tax net to raise more revenue to pay recurrent expenditure and for development.  Also subsidies on petroleum products are being removed whilst adjustments are being made in the tariffs of basic utilities to help shore up government finances.  The TUC in its contribution at the National Forum in Ho urged government to take steps to reduce what it described as inefficiencies, wastage and corruption in the public sector payment regime.  According to the Secretary General, the phenomenon of ghost names continues to plague the payroll system despite attempts to bio-metrically verify and capture workers and pensioners.  

The Fair Wages and Salaries Commission must do well to iron out all disagreements between it and identifiable Labour Unions and Association.  There is the need for circumspection in order not to de-motivate public sector workers.  All pay scales must be integrated to ensure uniformity and fairness.    The 18 point communique that was issued after the forum is quite reassuring and must be seriously considered if the Single Spine Pay Policy is to be sustained.  Pay must be linked to work and productivity must be the basis for compensation.  Workers owe it a responsibility to justify the huge salaries that they are earning under the Single Spine.  

As suggested, Article 71 office holders whose remuneration people are pointing fingers at must be quickly rolled on to the Single Spine to ensure equity.  It is worth noting the recommendation that the social partners adhere to the guidelines for the determination  of market premiums under the policy and that a labour sector survey start with the health and education sectors and this must be completed by the end of 2013.  Salaries from these sectors are truly impacting and must be carefully looked at.  Another suggestion tabled at the forum which can be considered is the need to wean State institutions with the capacity to be self-financing off government subvention.  

Some State institutions which have the capacity must be company structured and made profit-oriented.  Indeed the Ho Forum on Single Spine sustainability is well intentioned and similar forums must be organised to cover other areas of national interest.  Ideas and resolutions passed at the forum should be implemented with despatch and must not be allowed to suffer the fate of similar laudable national fora.  As  is said we cannot cut our nose to spite our face.


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