Reverse Kufuor’s Economic Curse
Former Finance Minister in the erstwhile Kufuor administration, Dr. Anthony Akoto-Osei, is shockingly begging Government to consider suspending portions of the single spine pay policy (SSPP) as its full implementation cannot be sustained.
Dr. Akoto-Osei, was instrumental in John Agyekum Kufuor’s Government that passed the SSPP salary structure into law by Parliament. President Kufuor kept it on his table and only assented to it on the eve of his exit from office pushing his successor, John Evans Atta Mills, into a fight with organized labour.
But at the Graphic-Fidelity Economic Dialogue held at the Alisa Hotel, yesterday, Dr. Akoto-Osei said, Government must re-negotiate with organized labour and also consider sacking some Ghanaian workers as part of measures to save the economy.
The policy takes about 70 percent of public spending; a situation, experts say could crush the economy if not checked.
“Everybody knows that our current wage bills are not sustainable. Mr. Minister, I think that we should defer full implementation of the single spine salary policy now. The Other components that have not started must be deferred but negotiated. Two and three category allowances, cannot be sustained in the next two or three terms.
“There are arrears on the wage bill, even with the first part of implementation; the minister must sit with labour and tell them he cannot pay it all.
“We are looking for 2billion [Cedis] in savings in that area”, he insisted.
Additionally, Dr. Akoto-Osei noted that payments of pensions, gratuities and social security are in arrears and must be negotiated, since the
budget cannot contain them this year.
He was of the view that some negotiations for retrenchment must begin, adding, “I know Government is in negotiations with labour. That wage bill of almost 9billion cannot be sustained”.
The Finance Minister, Seth Terkper agrees, the need for a review of the Single Spine Pay Policy cannot be over-emphasized. He says Government is looking at budgetary constraints as against public sector wage bill, productivity and other gratuities and considering steps to address the situation.
Regarding calls for the presentation of a new budget to reflect current economic trends, Mr. Terkper explained that it might be early days yet.
It is unclear how the Trade Union Congress (TUC) will take Dr. Akoto-Osei’s suggestion that workers should be laid off and salaries cut.
But what is strange is that Dr. Akoto-Osei’s party; the New Patriotic Party (NPP), has been crying that there are no jobs in Ghana, sacking people from what they already have could be an expensive venture for the government.
Already, the cedi is falling against the major trading currencies, forcing prices of goods and services to go up. Petroleum goods have not been spared the price hikes amid complaints from workers both, private and state.
There is also a moratorium placed on employments into State Agencies, especially Ministries, Departments and Agencies (MDAs).