EPOC Chairman Keith Duncan
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Outgoing EPOC Chairman Keith Duncan
By Andrea Chisholm
The Economic Programme Oversight Committee (EPOC) is warning that upcoming wage talks between the government and public sector workers will be tough, given the need to keep the wage bill in line with economic growth.
The outgoing chairman of EPOC, Keith Duncan, says a ceiling is needed on the wage bill to ensure it doesn't become a fiscal risk to the country.
Under the fiscal rules, Jamaica's wage bill was capped at 9 per cent of gross domestic product (GDP).
That ceiling was, however, removed in April 2023 to make way for the revised public sector compensation regime.
In the 2021/2022 fiscal year, public sector wages and salaries were $222.48 billion - that was 9.58 per cent of GDP and roughly 36 per cent of tax revenues.
By the end of this fiscal year, public sector wages are projected at $414.2 billion - roughly 13 per cent of GDP, and 45 per cent of tax revenues.
For the next fiscal year, there's a projection of $445.95 billion.
But public sector workers, like many Jamaicans, have been complaining about the high cost of living, and some are still upset about the massive increase to the political directorate.
For EPOC, frank discussion is needed as there is uncertainty around Jamaica's growth trajectory.
"This is where Jamaica needs to come together and we have a good understanding, be able to communicate and everybody can manage their expectations and manage their ask in a responsible way, knowing that we always want fairness and equity and knowing that the public sector has sacrificed over may years in taking wage freezes, etc," he argued.
EPOC says the Finance Ministry should conduct an analysis and devise a suitable public sector wage to GDP ratio.
That analysis should also consider workers' performance.
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