roadBlockAd
brand logo

Overstaffed State sector: ‘At least move them to different sectors’

26 Jun 2022

  • Labour needs to be re-prioritised and re-assigned to improve efficiency
  • Strict rule of recruitment should be followed for public sector
  • Large public sector not sustainable
  • Upskill and modernise staff
By Vinu Opanayake   The Central Bank of Sri Lanka (CBSL) continues to print money unabated to settle the salaries of State workers, while economists have suggested alternatives to reduce the burden on the State. Economists are of the opinion that excess State workers can be moved to other Government institutions or sectors to improve efficiency as termination of employment is not an option at present. University of Colombo Department of Economics Senior Professor Sirimal Abeyratne told The Sunday Morning that ‘once the Government recruits them, it cannot get rid of them’. “There are certain things that are irreversible, but there are other options; there could be other segments that require more inputs for workers. Considering those areas, you can shift some of these extra workers. They should be given adequate productive work to enable them to make a positive contribution to the economy. Otherwise they will be a burden to the Government budget,” Prof. Abeyratne stated. Prime Minister Ranil Wickremesinghe recently said that he was forced to print money to pay salaries to State sector employees. In the first quarter of 2022, the nation printed Rs. 588 billion. Speaking on State efficiency, Prof. Abeyratne noted that there were State institutions whose purpose was questionable, adding that the Government should move to get Key Performance Indicators (KPIs) from all State institutions and analyse their productivity. He also urged that decisions on employment should be taken away from the politicians.  Public sector employment  As per the Public Sector Employment Survey conducted by the Central Bank, total public sector employment increased to 1.493 million at the end of 2021 compared to 1.461 million in 2020. This includes employees in ministries, departments, district secretariats, divisional secretariats, provincial councils, and semi-Government institutions. The increase observed in public sector employment was due to the continued recruitment of unemployed graduates and multi-task development officers, and recruitments related to the armed forces, Police, and health sector.  However, a labour force survey conducted by the Department of Census and Statistics (DCS), found that public sector employees, employers, and own-account workers had increased notably in 2021 compared to 2020, whereas private sector employment declined marginally in line with the continued terminations amidst the interminable difficulties encountered by the private sector companies due to the pandemic. Nevertheless, the private sector continued to remain the main employment generator in Sri Lanka, representing the largest share of 42%, followed by own-account workers, which accounted for 33.4% of total employment in 2021. According to the CBSL, public sector employees experienced a real wage erosion of 6.4% during 2021 compared to 2020. However, upward revisions to the salary scales of Sri Lanka Principals’ Service, Sri Lanka Teacher Advisors’ Service, and Sri Lanka Teachers’ Service to remove salary anomalies of teachers and principals and a special allowance of Rs. 5,000 were announced by the Ministry of Finance a couple of months ago. Strict rules needed Speaking to The Sunday Morning, former Central Banker and Advocata Institute Senior Research Fellow Dr. Roshan Perera echoed Prof. Abeyratne’s sentiments: “You cannot suddenly get rid of State workers, but new recruitments can be reduced. There have to be very strict rules on public sector recruitment and this is the first thing that needs to be done, followed by seeing whether workers can be re-employed in other areas.” Perera noted that there were certain sectors in the economy that were finding it difficult to get workers and the private sector had many areas with vacancies. “Over time, moving into other sectors has to take place along with retraining and re-skilling. People come to the public sector because there is job security and a pension. The alternative too has to be attractive. In other countries, they do not have this huge, bloated public sector. You have a certain number of people in the public sector and the rest work in the private sector. I think we have to go for a model like that; we cannot sustain such a large number of employees,” Perera asserted. She also stated that this would not happen overnight and had to happen with time, but emphasised that recruitments should be frozen immediately.  She pointed out that everyone needed to understand that the public sector could not be the place where anybody could end up having a job, adding that State-Owned Enterprises (SOEs) were stuck with political supporters. “The number of State workers in SOEs is disproportionate to the activities they do, because that is where all the political supporters are. That has to stop. The governance of SOEs is important. The private sector will not do this; it will not recruit someone for the sake of recruiting, it will only hire if someone contributes to the bottom line. The same attitude has to be there in the Government and particularly in SOEs. Rationalise how people are recruited. Why do we have such a large and growing military when we are not in a conflict situation?” Perera questioned. No plans in the pipeline Despite various economists and international agencies highlighting the burden of an overpopulated State sector on the economy, which has resulted in colossal sums of money being printed by the Government, Ministry of Labour and Foreign Employment Secretary R.P.A. Wimalaweera when contacted by The Sunday Morning stated that as of now, no decisions had been taken to reduce the number of State workers or move them to other segments of the economy.  “We haven’t thought about anything to reduce the workers,” Wimalaweera stated, hanging up.  Attempts to reach him again to determine how they planned to ease the burden on the economy if they still had no plans to reduce the overpopulated State sector proved futile.


More News..