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Gaolathe opposes Masisi proposed civil service wage bill cut

Publishing Date : 11 June, 2018

Author : ALFRED MASOKOLA

Minority leader in parliament and Gaborone Bonnington South legislator, Ndaba Gaolathe has contended that there is no compelling evidence that can suggest that Botswana is in a desperate anomaly that requires it to cut off the size of its civil service as International Monetary Fund (IMF) suggests.


Recently, new president, Mokgweetsi Masisi told the international media that it is not his desire to grow the public service any bigger, and that if anything it is his desire to trim the civil service so “we are more efficient, we are leaner, meaner, and we can do business and we are more attractive to the private sector for them to invest”. Gaolathe has however warned that there could be danger in doing so because there is no evidence that indicates that if Botswana was to cut its wage bill, it would translate into growing economy that will create jobs for the populace.


“On the contrary, there is a danger that a poorly managed wage cutting exercise could be detrimental to the economy via the demand, productivity, expectations and income channels,” Gaolathe told WeekendPost this week. Gaolathe, a graduate in Economics and Finance, who once worked for government think tank, Botswana Institute for Development Policy Analysis (BIDPA) argued that it is noteworthy that there are several metrics for evaluating the wage bill, other than simply the amount of money in Pula terms that goes towards the wage bill.  


He indicated that various metrics exist including wage bill as proportion of GDP/output; wage bill as proportion of Government revenue, wage bill as proportion of Government expenditure, wage bill as proportion of national wage bill of all sectors including private sector.
“I have looked at some of these metrics juxtaposing them against many other countries, whether developed or undeveloped countries,” Gaolathe stated.  


“The evidence is not compelling as to suggest that Botswana is a desperate anomaly or that if Botswana was to cut its wage bill, it would translate into growing our economy or boosting employment for the majority of our people.” According to Gaolathe, the more important consideration before the Government of Botswana cuts its wage bill is to identify exactly what its economic agenda is and how it hopes to achieve it.


“Such an economic agenda also acts as a reference point for guiding the human and other resource requirements for achieving objective targets on national income/output and employment levels.  Currently we are not aware of a clear economic agenda with clear output/income and employment levels targets without which it does not make sense cut Government wages, before we even understand what we are trying to achieve,” he said.


There is evidence that wage levels have been eroded by rising costs of living over the years, according to Gaolathe, without any meaningful Government wage adjustments, something that he said is contributing to low morale within the public service, and possibly declining productivity as well. Gaolathe criticised government policy when it comes deployment in key portfolios in the civil service, as he argued that there is a clear failure to employ the best talent, who would in turn transform the country.


“Apart from low wages and declining morale, it is also evident that Government is failing to attract the best and brightest personnel to jobs that potentially impact economic growth and overall national prosperity.  So to cut wages even before you are able to get the basics right, of getting the best and brightest in the right places, could prove suicidal to the quest of building a viable economic foundation for prosperity,” he revealed.


He added that there is also the question of managing the cyclicality of any economy and that effectively the Government of Botswana has cut wages abruptly in past years including the early 1980s, first part of the 1990s and in much of the recent decade (nominal wage freezes are equivalent to real wage cuts), from this experience we know the associated effect it has on exacerbating /extending economic recessions.


“ In others words, wage cuts would not and are not new; also wage cuts if not complemented by a raft of complementing progressive policies have no positive impact on national income, employment levels or prosperity,” he observed. With a crystal clear economic agenda, it is possible to map a human resource plan for the civil service that takes into consideration both the fact that Botswana needs to grow the economy and that it also needs to manage cost.


“This plan could focus on improving our processes, adopting new ways of doing things without necessarily cutting costs, but significantly upping output relative to cost.  This would constitute a much more superior strategy than one alleged to be emanating from the world bank of a clear cut wage reduction.

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