IMF Directs Gov’t Not To Increase Wages Above 15%

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IMF Directs Gov’t Not To Increase Wages Above 15%

Details: Parent Category: Main; Category: NewsBrief; Created on Monday, 19 January 2015 00:00

governance

IMF Directs Gov’t Not To Increase Wages Above 15%

Ghanaian workers seem to have become the first casualties of the soon to be initiated IMF Bailout for Ghana’s distressed economy, as information from Washington indicates that the IMF has strictly directed the John Mahama government not to increase the current wages for Ghana’s public employees above 15% in 2015.

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It would be recalled that as a result of the dire circumstances of the Ghanaian economy, government refused to increase the base pay on the Single Spine Salary Structure (SSSS) and rather handed out to workers a paltry 10% of the 2013 basic salary as Cost of Living Allowance (COLA) for public sector workers.

Fuel prices have increased by roughly 45% since the last increase in the base pay in 2013 while electricity and water tariffs have also seen increases by over 90% and 72% respectively since the last base pay increase in 2013. These fuel and utility increases since 2013 coupled with the fact that basic prices of goods and services have seen at least 30% increases since 2013 mean that the real wages of Public Sector workers have declined over the 2013 level and will need at least a 30% increase on their current wages to be able to see their real wages equaling the 2013 level.

With these stark realities concerning the wages of public sector workers vis a vis the meteoric rise in the cost of living since 2013, workers are set to demand not less than a 25% increase in their wages, which will still mean that the real wages of public sector workers will still be below the 2013 level.

However, with the IMF bailout discussions in the homestretch ahead of the commencement of the bailout program in April or May, government is set to offer workers not more than a 15% increase, a situation which will mean that with further increases in the cost of living expected, real wages of workers would further slide to much lower levels below the 2013 figure.

Source: New Crusading Guide/Ghana