FINANCE Minister Nigel Clarke has indicated that the Government is pushing to make back payments to 60,000 central government workers on their new salaries, retroactive to April 2022, and start paying new salaries, by next month.
Dr Clarke emphasised during a meeting of the Standing Finance Committee of the House of Representatives on Tuesday that making the payments will require the cooperation of ministries, agencies, departments, and Parliament, pointing out that in some instances the back payments will be significant, especially for those at the bottom of the scale.
The finance minister was answering questions from Opposition spokesman on finance Julian Robinson, and other members of the Opposition, as members deliberated on the first supplementary estimates for this fiscal year, and the public bodies’ first supplementary budget.
He also advised that the Government will have to bring a second supplementary budget to Parliament in order to effect the payments.
“We are going to work assiduously to ensure that persons in groups represented by unions which have signed, that they receive back pay and begin to receive their new compensation as soon as possible. We are working towards December. That will require a second supplementary [budget]â€¦at the time the [first] supplementary was being tabled, there was no agreement. To facilitate payment in December will require us coming back to the House pretty quickly,” he pointed out.
The proposed removal of the motor vehicle concession benefit for public sector workers is now off the table. Dr Clarke said the policy will remain in place, under discussion.
Asked by Robinson whether there would be a “netting-off” of the back salary payments, the finance minister stressed, “You’re using a very negative spin on it. Persons will have a new salary, effective the first of April, which will be higher on a net basis than their existing salary, and we will calculate that new salary for 10 months and the old salary for 10 months, and the difference will be paid as back pay. There is nothing about that that is complicated.”
In recent weeks Dr Clarke signalled to the sector that negotiations on the new public sector compensation scheme needed to be wrapped up in order to make the payments before year end. He said there would be no room in the 2022/23 budget to make the back payments, which are in the tens of billions.
He also advised the Standing Finance Committee that workers will not be required to refund any benefit payments they received since April, as the Government moves to remove a laundry list of allowances which now exist in the public sector.
At the same time Clarke told the committee “let me get back to you on that”, in relation to the question of whether over the three years of the new negotiated salary agreements public sector workers will still receive the usual incremental increases.
Dr Clarke explained that an evaluation tool will be applied to all jobs, determining where positions are placed on the new salary scales. He said this conversation table will map posts in the service into the new compensation scale system.
He outlined that the 60,000 employees who the Government will focus on for payment in December are unionised categories, which account for the majority of public sector workers: “We are still in discussions with the teaching profession, which numbers approximately 25,000, [and] the police which number 12,000 or 13,000,” he said, noting that when those discussions are concluded, it would bring the number of employees under the new compensation scheme to just under 100,000, closing out the central government categories.
This leaves the public bodies, which he said will be treated separately, with boards of management playing a key role in those arrangements.
“The good news is that as far as central government is concerned, 60,000 represents a strong start,” he stressed.
The Government has touted the new compensation as one in which workers will receive more basic pay and take home more substantial net incomes. The rationale is that the current compensation system is too complex, with 325 salary scales and 185 allowances, which make up a large proportion of total compensation for some groups.